Thursday, November 30, 2023

Cost of electricity to increase 78 per cent in April

Kenyans will have to dig deeper into their pockets to pay for electricity come April 2023.

This will happen if Kenya Power’s plan to increase the cost of electricity is approved by the Energy And Petroleum Regulatory Authority (EPRA).

Kenya Power says that it is already engaging the EPRA in order to have the charges adjusted upwards. This will in effect seen consumers pay up to 78 per cent more than what they are currently paying.

In addition to lobbying for the increase in the base tariff, Kenya Power has also reduced the threshold for accessing the monthly power subsidy equivalent to a 24.1 per cent discount from 100-kilowatt hours to a proposed 30 units.

“There is a proposal to revise the Life-Line (subsidy) consumption band for both small commercial and domestic customers from the current 100kWh/month to 30kWh/month,” Kenya Power said.

“This will align the objectives of the lifeline/social tariff customer category with the correct social class normally defined by the level of income.”

Kenyans who consume 50-kilowatt hours (kWh) a month will pay Sh. 36.92 a unit from the current Sh. 20.70.

When Kenyans pay for electricity, the biggest amount of their money currently goes to taxes and levies as opposed to what they have purchased.

According to renowned data analyst Elijah K. Samuel, up to 63 per cent of every Sh. 1,000 a consumer spends on electricity goes to taxes and levies.

“Buying the electricity of Sh. 1,000 (assuming a monthly usage of less 100 Units), only about 37 per cent goes to consumption, and the rest 63 per cent goes to taxes and levies,” said Samuel.

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He added that 35 per cent goes to fuel energy while 9.4 per cent goes to forex. “It is worth knowing that 35 per cent goes to the Fuel Energy Charges, and 9.4 per cent to the Forex Charges,” he said.

According to Samuel, this indicates that Kenyans are buying taxes and levies, and getting electricity tokens as a bonus.

In their new proposals, Kenya Power wants to increase the cost of a unit of power for the usage of less than 30 kilowatts per month to Sh. 28.01 a unit, up from the current Sh. 20.70. This will reflect a growth of 35.3 per cent.

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