•Kenya Power wants electricity tariffs revised upwards to help cover costly wholesale purchases and maintenance of the national grid.
•Electricity tariffs cover the cost of generation, transmission and distribution. A kenya Power Meter box at Villa Estate Mlolongo/FILE The Energy and Petroleum Regulatory Authority (EPRA) now says it is reviewing the Kenya Power tariff application formula which will inform new adjustments in electricity billing in the country.
This follows a proposal by Kenya Power to revise electricity tariffs upwards by at least 20 per cent, to help cover costly wholesale electricity purchases from generators such as KenGen, and maintenance of the national grid.
The utility firm has blamed an increase in non-fuel power purchase costs for its recent 91.9 per cent drop in profit, where in the year ended June 30, 2019, net earnings fell to Sh262 million from Sh3.3 billion the previous year.
The costs went up by Sh18.1 billion to Sh70.9 billion, from Sh52.8 billion in a similar period in 2018, it notes in its audited financial results.
Kenya Power made an application for a review of tariffs last year, opening talks with the regulator.
Though it is not clear when the process will be completed, EPRA said it will engage stakeholders before coming up with a conclusive decision.
“The authority is currently reviewing the Kenya Power tariff application and as required by the Constitution, EPRA will engage stakeholders before making the final decision,” acting Director General Mueni Mutung’a told the Star.
Kenya Power has the blessings of the Energy ministry to boots its revenue stream to cushion it from costly power purchase agreements, which has seen it pay for unutilised energy.
The country has a generating capacity of over 2,800MW with a demand of about 1,926, the highest, recorded in February this year before Covid-19 interrupted the economy.
According to energy experts, the current capacity charge is 90 per cent of the tariff revenues, which leaves Kenya Power struggling, despite enjoying monopoly.The utility firm wants to increase the consumption charge for usage of less than 100 kilowatts per month to Sh12.50 a unit, up from an average Sh10.Consumers of above 100 units will part with an average Sh19.53 a unit from the current Sh15.80, if the proposal is adopted.The move will hurt household budgets and raise the already high cost of doing business in the country, where manufacturers and businesses will be forced to recover increased costs from consumers.EPRA has however affirmed its commitment to ensure […]
