Poor pay heavily for high power costs

What you need to know:

Homes that consume 50 kilowatt hours (kWh) a month, mostly low-income earners, paid Sh576 in July.
Middle class homes that consume 200 kWh a month paid Sh3,642 in July, up from Sh3,361 in a similar month last year — an 8.4 per cent rise — slightly lower than the poor’s.
The rise is due to increase in thermal power intake, which has pushed the associated fuel costs charges in bills by 23.4 per cent over the past year while forex levy is up by a quarter.

Poor homes bore the brunt of high electricity prices that rose 9.7 per cent in the past year due to increased use of expensive diesel-fired power and a rise in forex charges.

Data from the Kenya National Bureau of Statistics (KNBS) shows that homes that consume 50 kilowatt hours (kWh) a month, mostly low-income earners, paid Sh576 in July, up from Sh525 the same month last year — a 9.7 per cent rise.

The KNBS data shows that middle class homes that consume 200 kWh a month paid Sh3,642 in July, up from Sh3,361 in a similar month last year — an 8.4 per cent rise — slightly lower than the poor’s.

The rise is due to increase in thermal power intake, which has pushed the associated fuel costs charges in bills by 23.4 per cent over the past year while forex levy is up by a quarter.

READ: April power prices hit 30-month high

Use of diesel generators has been triggered by a steep dip in cheaper hydropower generation as a result of prolonged drought that cut dam water levels.

Consumer power bills come loaded with fuel levy and forex surcharge which are adjusted every month by the energy regulator.

The fuel levy, which is linked to the amount of power produced by diesel generators and injected into the national grid, stood at Sh2.85 per kWh last month, up from Sh2.31 in the same month last year.

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The forex levy, linked to foreign currency expenses incurred by the Kenya Power #ticker:KPLC and electricity producers is up to Sh1.05 per unit from Sh0.84 in July 2016, according to Energy Regulatory Commission records.

The prolonged drought has cut water levels in dams, slashing hydropower production 40 per cent to lows of 179.3 million kWh in June from 299 million units last December.