Electricity Tariffs to Decline by 8% in July in Plan to Reduce Cost of Power

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Kenya Power and the Energy Regulatory Commission (ERC) have announced that electricity costs will decline by eight per cent starting from next month.

The ERC chief executive officer Pavel Oimeke and Kenya Power managing director Dr Tarus told the Energy Committee in Senate that a multi-agency team was reviewing tariffs with the aim of reducing the cost of electricity for consumers.

The announcement by the two entities is in line with orders given by Energy CS Charles Keter in April. The ERC was given three months to review the tariff structure while Kenya Power was given a month to review token tariffs.

“The tariff review process is scheduled for completion by end of July and the proposed commencement date is July 1. Billing is to be done in August based on the July consumption,” said Mr Oimeke.

Improving the Tariff Structure

ERC’s chief executive said the two entities are amending the tariffs to ensure that they are predictable and that Kenyans are not charged fixed costs when they have not consumed electricity. He also added that Kenya Power had presented a tariff review in January which sought to address customer connectivity, network maintenance, infrastructure development, and loss reduction.

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“The commission has made a preliminary review of the application and plans for various stakeholder engagement in the month of June and July before making the final determination,” he said.

The ERC has solved high electricity cost by removing the demand charge for industrial and commercial consumers and harmonising it with the energy charge. The regulator has also harmonised monthly fixed charges into one energy charge.

The ERC has also created a new category of customers using up to 15 units. This category comprises of 3.5 million customers.

“The area that has been harmonised includes splitting the small commercial category consumers into two based on consumption,” said Mr Oimeke.

The two categories include small commercial customers that use between one and 1,000KWh and SMEs that use 1,001 to 15,000 kWh.

“The changes will ensure that the tariffs are predictable and that consumers are not charged for fixed costs when they are not consuming power,” stated Mr Oimeke.

Dr Tarus said prepaid customers will receive the same number of units for purchases made at any point in the month.

“A harmonised tariff will ensure uniform charges on all units as directed by Energy Cabinet Secretary Charles Keter. This is expected to be in place by July,” Dr Tarus asserted.

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