High Electricity Bills, Here Is What You Will Pay From Sunday

By Jane Muia / Published December 30, 2022 | 11:46 am

KEY POINTS

In January, the government announced a 15 percent reduction in power tariffs, part of former President Kenyatta’s 30 percent reduction pledge last year. The reduction sought to boost livelihoods and economic growth by reducing the cost of living.

KEY TAKEAWAYS

From the 26 billion shillings subsidy, Kenya Power lost an annual revenue of 7.8 billion shillings, Kenya Electricity Generating Company (KenGen) – 3.5 billion shillings, Kenya Electricity Transmission Company Limited (500 million shillings), and Geothermal Development Corporation relinquished 346 million shillings.

Kenyans will from Sunday 1st January 2023 pay 15 percent more for electricity after the government wiped out the electricity subsidy initiated by former president Uhuru Kenyatta.

Energy and Petroleum Regulatory Authority (EPRA) director-general Daniel Kiptoo said the 15 percent discount would not be extended beyond its expiry date of December 31, setting the stage for costly electricity for homes and businesses.

President William Ruto has been against all subsidies including fuel and food subsidies that were used by the previous administration to cushion Kenyans against harsh commodity prices, terming them unsustainable for both consumers and the government’s fiscal operations.

“When the new government came in, it withdrew the support (subsidy) in August, and thus after the end of December, we will revert to the rates that were in place before January,” Kiptoo said.

A further cut was slated for April 1st, but this could not be implemented. The Independent Power Producers (IPPs) opposed the matter, where they were required to lower the cost at which they sell electricity to Kenya Power.

IPPs sell power to KPLC at about 10 shillings per kilowatts hour, while the thermal company sells at about 20 shillings per kilowatts hour.

The utility company in September started implementing a 21 percent hike in power charges that were previously silently gazetted by the EPRA. The 21 percent hike pushed the cost of one kilowatt from 24 shillings to 25.3 shillings for domestic consumers, up from 21.87 shillings in January this year.

This saw consumers get 19.84 units for 500 shillings in September compared to the 25.55 units the same amount would purchase in August.

Soaring diesel prices were blamed for the high cost of electricity. Diesel is used to power machines in thermal plants with the extra cost passed to the consumers in power bills.

The increase in the cost of electricity will unleash pricing pressure across the economy as producers of services and goods factor in the higher cost of energy coming as a blow to consumers who are also grappling with inflating prices of fuel and food amid the worst drought in 40 years