Electricity bills set to shoot up by 54pc - Daily Nation

Middle-class households face increase in power bills

Monday July 30 2018

There is need to simplify the electricity billing method. PHOTO | FOTOSEARCH

There is need to simplify the electricity billing method. PHOTO | FOTOSEARCH 

By NEVILLE OTUKI
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By NJIRAINI MUCHIRA
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Power costs for middle class households will from Wednesday shoot up by up to 54 per cent when the new billing structure takes effect.

Poor households that consume less than 10 units per month and very the rich, who burn more than 1,500 units will, however, enjoy lower bills under the tariff structure announced by the Energy Regulatory Commission on Monday.

The tariffs are effective from August 1 for the pre-paid users and July 1 for those having post-paid meters.

The regulator removed the Sh150 fixed charge payable to Kenya Power for meter connection, saying it would do away with billing fluctuations.

The fluctuations have been a source of numerous complaints from consumers.

HIGHER RATES

The tariff increase is good news for Kenya Power, which has been pushing for higher rates, citing increased operating costs and the need for more funds to upgrade its rickety network.

“In order to ensure financial viability, economic feasibility and a sustainable and affordable tariff, the commission has approved an increase in the revenue requirement from Sh120 billion to Sh131 billion,” ERC Director-General Pavel Oimeke said.

In the new plan, homes that consume 50kW of electricity per month will pay Sh1,067, up from Sh695.

This is based on all the charges loaded on power bills, including 16 per cent VAT and adjustable costs (fuel, forex and inflation charges).

DOUBLE DIGIT DROPS

Households that consume 200 units will pay Sh4,268, up from Sh4,121.

These two consumer groups are the focus point in the Kenya National Bureau of Statistics’ inflation basket.

Besides rising operating and finance costs, Kenya Power was last year left with a Sh10 billion hole in its books when the government put a lid on electricity price increases as it was an election year.

The smallest power consumers, who happen to be the majority, will enjoy double digit drops. More than half of Kenya Power customers — around 3.6 million — fall within this segment.

A 10-unit user, for instance, will pay Sh169 a month, down fromSh278. Those who consume 500 units a month will part with Sh10,672, a three per cent drop.

Previously, households consuming less than 50 units paid Sh2.50 per unit.

DRASTIC REDUCTION

Those consuming between 51 to 1,500 units forked out Sh12.75 per unit while those consuming above 1,500 units paid Sh20.57.

In the last few months, the government has been blowing hot and cold on reducing the cost of power.

Only last week, Energy PS Joseph Njoroge said a drastic reduction in electricity bills should be expected from September when Lake Turkana Wind Power is connected to the national grid.

“Concentration is on supervision of the transmission line and we expect it be completed at the end of next month,” Mr Njoroge said in a Citizen TV interview.

He added that a deal with a new contractor has saved taxpayers Sh1 billion in monthly fines that was to be paid to LTWP for idle power.

This is after the government negotiated with the company to delay the commencement of the commercial operating date of the fines to end of next month.