The Energy and Petroleum Regulatory Authority (Epra) is required to gazette the reduction in power bills, which should be implemented by Kenya Power, the near-monopoly electricity distributor.
The President on December 12 said homes and businesses will start enjoying a 15 percent dip in cost of electricity last month to be achieved through reduction of power theft and leakages in Kenya Power’s transmission network.
Kenyan households and businesses did not experience a 15 percent drop in electricity bills by Christmas as promised by President Uhuru Kenyatta after the energy sector regulator failed to sanction expected changes in tariffs.
The Energy and Petroleum Regulatory Authority (Epra) is required to gazette the reduction in power bills, which should be implemented by Kenya Power, the near-monopoly electricity distributor.
Epra director-general Daniel Kiptoo told the Business Daily that he will be in a position to “discuss” why the regulator had not implemented the reduced tariffs in December once he returns from Christmas break today (January 3).
A source at Epra said gazetting reduced tariffs was “a process still in pipeline”, pointing to difficulties in implementing the presidential pledge of a drop in tariffs upon the advice from a task force Mr Kenyatta appointed to help lower power costs.
The President on December 12 said homes and businesses will start enjoying a 15 percent dip in cost of electricity last month to be achieved through reduction of power theft and leakages in Kenya Power’s transmission network.
Kenya Power’s system losses through a confluence of power theft and leakages from the ageing transmission grid shot to 24.14 percent for the year to June, or an equivalent of Sh20.1 billion.
This is a jump from 17.51 percent in 2015, signalling the impact of prolonged under-investment in the transmission grid despite rising demand for power connection.
Mr Kenyatta said another 15 percent fall in power bills is expected by March when the State is expected to reach a deal with independent power producers (IPPs) on high prices they charge Kenya Power.
The Business Daily has not been able to establish how Kenya Power planned to reduce system losses, the share of electricity bought from generators such as KenGen that does not reach homes and businesses, within weeks despite battling for decades to cut power theft and leakages.
Electricity bills seen by this newspaper showed that a home which consumes less than 100 kilowatt hour (kWh) or units – technically referred to as domestic lifeline consumer – was billed Sh18.91 per unit on December 31.
The cost – which comprises consumption charge, taxes, levies and pass-through costs – is a 12.96 percent rise from Sh16.74 per unit in early June.
On the other hand, households which consume more than 100 kWh a month – domestic ordinary consumer – paid Sh25.93 per unit late last month.
Without the pass-through costs, the lifeline consumer buys a unit of power at a standard rate of Sh10 while the ordinary consumer is charged Sh15.8.
The rise in cost of electricity bills is largely due to variable costs such as 16 percent value added tax, fuel cost charge that reflects compensation for expensive diesel plants, foreign exchange charge and five percent REP levy for rural electrification.
President Uhuru Kenyatta had promised in August to cut consumer electricity tariffs by 33 percent ahead of Christmas in a plan that hinged on a review of power purchase agreements (PPAs) signed over the years.
But the IPPs opposed the reduction, arguing that Kenya has no unilateral right to alter the contracted capacity and payments, saying instead that the State has a duty to protect PPAs inked over a period of 20 years.
