The Energy Regulatory Commission on Friday said fuel levy in May electricity bills will fall to Sh4.95 per kilowatt hour (kWh) from April’s Sh5.35 on reduced use of expensive diesel generators to feed power to the national grid.
Heavy reliance on the fuel generators due to low water levels in the country’s hydro-electric dams, has been blamed for the rise in fuel surcharge and forex adjustment costs.
The fuel surcharge has steadily increased from Sh2.31 kWh in October 2016, a jump that has made electricity prices rise the most among basic home commodities.
Electricity prices have fallen for the first time this year on increased use of cheaper hydro power, easing budgetary stain on homes and businesses reeling from historic high power costs.
The Energy Regulatory Commission on Friday said fuel levy in May electricity bills will fall to Sh4.95 per kilowatt hour (kWh) from April’s Sh5.35 on reduced use of expensive diesel generators to feed power to the national grid.
Heavy reliance on the fuel generators due to low water levels in the country’s hydro-electric dams, has been blamed for the rise in fuel surcharge and forex adjustment costs.
The fuel surcharge has steadily increased from Sh2.31 kWh in October 2016, a jump that has made electricity prices rise the most among basic home commodities.
Forex charge, which compensates for foreign currency costs, including loans that power producers have in their books, dropped to Sh1.22 from Sh1.44, leaving consumers with net savings of Sh0.64 per kWh excluding taxes.
The savings of Sh0.64 a unit will see homes and businesses make overall saving of nearly Sh700 million on the power bills, based on the monthly consumption of 891 million kWhs and taxes including VAT of 16 per cent.
KenGen #ticker:KENGEN last month increased production of cheap hydropower following weeks of heavy rains that have filled up dams, setting the stage for an easing of electricity costs that steadily rose six months in a row.
“We will step up hydro generation in the months ahead but ensure we conserve available water to last until the short rains later in the year,” KenGen managing director Rebecca Miano said in a statement.
The weatherman forecasts continued downpour through the end of the month with some parts of the country expected to record heavy showers.
Power bills for homes that consume 200-kilowatt hours (kWh) per month rose from Sh3, 575 in January last year to Sh4,322 in April — one the fastest monthly growth among basic household items.
The financial pain also caught up with bottom-end power users whose bills surged seven per cent last month to cross the Sh700-mark for the first time.
The low-income earners (consuming 50 units of electricity a month) paid Sh745 in April, up from Sh559 in January last year.
Electricity prices have a direct bearing on inflation, being one of the items in the basket of goods and services whose pricing is tracked to measure the cost of living.
