NAIROBI, KENYA, JULY 30 ― Kenya has announced new electricity tariffs across all the eight consumer platforms in what is seen as a relief for users after the scrapping of fixed monthly charges.
In the new tariffs announced by the Energy Regulatory Commission on Monday, the regulator has removed monthly fixed charges of between Ksh150 (for domestic and small commercial) and Ksh17, 000 for industries with limitless consumption.
According to ERC, the new tariffs effective July 1, have reduced the cost of electricity from Ksh17.77 per kilowatt hour to Ksh16.64 per kilowatt hour.
“ERC’s review follows the need to accommodate more renewable energy costs and address the numerous complaints by electricity domestic consumers on the complexity of the tariff billing regime which was difficult to understand,” ERC Director-General Pavel Oimeke said.
Kenyans, especially domestic consumers have in recent times grappled with inflated bills raising questions over Kenya Power and Lighting Company’s billing system.
ERC said it took into consideration KPLC’s tariff application and engaged stakeholders including public hearings and memorandas written to the commission before coming up with the revised tariffs.
“The commission also took into consideration best practices in tariff setting that emphasize on social equity, economic prudence and financial viability of sector utilities,” Oimeke said.
The Energy Ministry has since said the new tariffs will facilitate the successful implementation of the Government’s Big Four Agenda on manufacturing, food security, affordable housing and access to universal healthcare.
“To help stir commercial and industrial production, ERC approved an average 4.4 per cent reduction on electricity bills in this category. These categories include both small and large industrial consumers who form the core production scale in the country,” the ministry said.
Domestic consumers of between 0 and 15,000 Kwh per month have been paying a fixed monthly charge of Ksh150 in addition to their consumption.
Commercial utilities consuming more than 15,000 Kwh per month have been parting with Ksh2,500 per month in addition to their consumption, while industries with no monthly limit have been paying between Ksh4,500 and Ksh17,000 as fixed charges depending on their classification.
Street lighting has been attracting a fixed charge of Ksh200 per month.
The new tariffs are however likely to push up the cost of power for some consumers especially the middle class, while lowering the cost for low end consumers and industries.
According to the approved energy Non-fuel electricity retail tariffs for the period 2018/19, domestic consumers of 0-10 Kwh per month will pay Ksh12.00 per kilowatt hour, up from Ksh2.50.
Those taking up 11-50 units will part with Ksh15.80 per kilowatt hour up from Ksh2.50 under the old tariff.
Between 51-1500 kilowatt hour per month will cost Ksh15.80 per Kwh up from Ksh12.75 in the current regime.
Domestic consumers of more than 15,000 units will however pay Ksh15.80, a reduction from Ksh20.57 per kilowatt hour.
Small commercial entities consuming between zero and 15,000 kWh per month will part with Ksh15.60 per Kwh compared to Ksh13.50 in the expiring regime.
The cost of a unit for industries consuming more than 15,000 kilowatt hour per month has also gone up to Ksh12.00 from Ksh9.20.
Industries with limitless consumption will pay between Ksh10.10 and Ksh10.90 per kilowatt hour from a previous charge of between Ksh7.10 and Ksh8.00 per kilo watt hour. This however is less the high monthly fixed charges in the old regime which went up to Ksh17,000.
The cost of street lighting will increase with a unit costing Ksh7.50 up from Ksh4.36 per kilowatt hour in the current regime.
Commercial and industrial consumers stand as the biggest beneficiaries of the new tariff as the government counts on local industries to achieve its manufacturing arm of President Uhuru Kenyatta’s Big Four Agenda.
The government is keen to increase the sector’s contribution to the Gross Domestic Product to 15 per cent by 2022 from the current 11 per cent.
“All categories of electricity consumers can plan for their power consumption without worrying about the fixed rates,” the ministry affirmed.