Economy

High power charges pile pressure on households

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A Kenya Power technician inspects a line. file photo | nmg

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Summary

  • Rise in fuel cost adjustment levy increases bills, hurting consumers and firms
  • The fuel cost hit Sh5.35 per unit of electricity consumed last month from Sh4.51 in February. 
  • Kenya recorded steady drops in power bills from 2015 following the injection of additional 280 megawatts of cheaper geothermal energy to the grid between July and December 2014.

Spikes in monthly electricity prices have continued even as the weather improves, piling pressure on the budgets of homes and businesses already reeling from expensive power despite the government promise to lower costs.

Power bills for homes that consume 200-kilowatt hours (kWh) per month, mostly middle class, jumped five per cent in the past month to a new high of Sh4,262 in March — one the fastest monthly growth among basic household items.

The 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 Sh730 in March, up from Sh682 a month earlier, according to data from Kenya National Bureau of Statistics (KNBS).

“The rise in the cost of electricity was attributed to rise in fuel cost adjustment charges per kWh of consumption,” the KNBS said.

Fuel cost charge, which is linked to the amount of power produced by diesel generators and supplied to consumers, hit Sh5.35 per unit of electricity consumed last month from Sh4.51 in February. 

READ: Fuel levy raises power bills to 41-month high

Depressed hydropower

This was due to increased uptake of expensive diesel-generated power following months of depressed hydropower production.

The KNBS data shows that consumers have absorbed an upsurge in power bills by up to 28 per cent over the past year, even as electricity distributor Kenya Power fights charges of inflating its monthly billings.

Power bills have recently been hitting new highs following months of steady increments.

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.

Last month’s fuel levy of Sh5.35 per unit returned the country to levels last seen in 2014 before it added 280 megawatts of cheap geothermal power to the grid that helped reduce reliance on expensive thermal power.

But last year’s drought cut dam water levels and depressed hydropower production, triggering a spike in thermal power generation as an alternative.

READ: EDITORIAL: Battle for cheaper power still far from being won

Steady drop

Kenya recorded steady drops in power bills from 2015 following the injection of additional 280 megawatts of cheaper geothermal energy to the grid between July and December 2014.

This led to reduced use of expensive diesel-generated power and lower fuel levy in power bills.

But the bills have been on an upswing recently due to a spike in the intake of expensive thermal power as poor weather cuts production of cheaper hydropower, erasing benefits of the cheaper steam power.