Home Business Cost of power per unit to go up by between 13 to 20pc in new tariff review

Cost of power per unit to go up by between 13 to 20pc in new tariff review

by kenya-tribune

NAIROBI, Kenya, January 30 – The cost of power for domestic consumers will go up by between 13 to 20 per cent in the new proposed tariffs, inclusive of levies and taxes, Kenya Power has revealed.

In the new tariffs, consumers under the new life-line consumption band of below 30 kilowatt-hours (kWh)per month will pay Sh20.5 per unit from the current Sh18.14, a 13 per cent jump.

Out of the Sh20.5, Sh14 is the consumption charge meaning Sh6.5 is on taxes and levies.

If the tariffs are approved, users in this band spending Sh300 on power will get 14.6 units compared to 16.5 units.

Further, ordinary domestic consumers whose usage exceeds 30kWh per month will pay Sh26.4 per unit from the current Sh22, a 20 per cent increase.

Out of the Sh26.4, Sh21.00 is the consumption charge meaning Sh5.4 is on tax and levies.

In this band, once the tariffs are approved, a user spending Sh1000 on power will get 37.8units from 45.45 units currently.

In the components of the power bill, the Water Resource Management Authority Levy(WRMA) increased almost 4000 times from Sh0.05/kWh to Sh2.00.

The fuel cost will be maintained at Sh3.90 same as the Foreign Exchange Rate Fluctuation Adjustment(FERFA) which has been maintained at Sh1.

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Kenya Power noted that without the increase in WRMA, the adjustments would be at a slower 11 per cent and 18 per cent respectively for the lifeline and ordinary customers.

Further in the bill is a VAT charge of Sh2.9 for lifeline users and Sh4 for ordinary domestic customers.

The proposed tariffs are still undergoing stakeholder participation spearheaded by the Energy and Petroleum Regulatory Authority(EPRA) before being gazetted.

As part of the tariff review, the utility firm revised the Life-Line consumption band for both from the current 100 kWh per month to 30kWh per month.

This is expected to see the number of consumers in the lifeline band drop to 6.3 million from the current 8 million, meaning 1.7 million Kenyans will pay for costlier power.

Kenya Power Acting Managing Director said the reviewed tariffs are expected to increase the sector revenue requirements by around 15 to 20 per cent.

In 2022, Kenya Power collected Sh154 billion in revenue, he revealed.

The increased cost of power for households is expected to result in a higher cost of living with food and fuel prices remaining elevated at the start of the year.

In December, Kenya’s inflation rate remained at a high of 9.1 per cent.

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