Kenya: Law Makers Direct Kenya Power To Review Levies, Lower Cost Of Electricity

Kenya’s National Assembly’s Energy Committee has raised concerns over the high cost of electricity in the country.

The committee, on Tuesday, quizzed officials from the energy sector, including Energy Principal Secretary, Alex Wachira, and top KPLC management on the cost of electricity.

They directed the relevant entities to quickly recall the high levies mounted on the power billing to bring the prices down.

The Ministry of Energy told Parliament that it is seeking to bring back to the table all independent power producers to address the high cost of power.

Questions such as, ‘Who holds the power to lower the cost of power and electricity in the country?” dominated the session that had been trying to crack the nut on who would go to the rescue of Kenyans who are digging deeper into their pockets to purchase power.

“For how long are we going to talk about the high cost of electricity, bwana PS?” posed Energy Committee Chair Vincent Musyoka.

Embakasi South MP, Julius Mawathe, added: “As a committee, we want to know why we should buy at Ksh.28 per kW yet our neighbours are doing Ksh.12 shillings per kW.”

In his response, PS Wachira said: “There are a lot of factors that go into the pricing of power; it is not only what you are saying. We have done a lot of subsidy, including in industries.”

The PS told Parliament that the ‘elephant in the room’ is the Independent Power Producers (IPPs) whose initial contracts and pricing continue to dictate the high cost of power.

The Ministry said it is seeking to bring back the IPPs to the table to renegotiate their power purchase agreements, with an option of termination seemingly costly, estimated to cost the power supplier over Ksh.30 billion in termination costs.

“It is good you understand that the geothermal is not the problem; the problem is the renewable energy firms and their pricing,” Wachira said.

EPRA boss, Daniel Kiptoo stated: “Bringing down the cost of electricity has to go through various stages. We shall have to look into the minor charges mounted on the billing.”

The lawmakers also pushed KPLC to widen its reach.

“Even as we are seeking lower prices, KPLC should now by connecting more Kenyans, it will collect more money as revenue on bills,” Awendo MP John Walter noted.

Kenya Power Managing Director, Joseph Siror said: “We are working on putting more Kenyans on the main grid. For instance, we are just waiting for the Treasury to give us the go-ahead to award a tender of Ksh.1.2 billion to start the Lodwar-Mandera grid
project.”

An audit report by Kenya Power for the financial year 2022 revealed a major disparity between the cost of power procured from the Kenya Electricity Generating Company (KenGen) and the power procured from IPPs.

The disparity, which translates to billions of shillings, is reflected in the cost of electricity bills to consumers.

Source: https://energynewsafrica.com