The cost of electricity has been steadily declining over the last 12 months as the Kenya Shilling made gains against the US Dollar.
Speaking during a meeting with the Kenya Editors Guild today, Kenya Power Managing Director & CEO, Dr. (Eng.) Joseph Siror, said the strengthening of the shilling had resulted in lower pass-through costs to customers, including forex and fuel costs, which are heavily dependent on the prevailing dollar exchange rate.
“This has added to the gains from the decline in the base energy cost following a review of the electricity tariff in April 2023 which put in place a three-year tariff that provides for a lower cost per unit, starting in July of each of the three years. So far, the base tariff has declined from Ksh19.04 per unit in 2023 to the current Ksh17.94,” said Dr. (Eng.) Siror.
Kenya Power is, however, concerned that the push for the inclusion of wayleave charges on power infrastructure will reverse this trend, pushing the cost of electricity by up to 30% which customers could bear as a pass-through charge.
“Kenya Power has over 319,000 kilometres of power lines across all 47 counties. The introduction of wayleaves on power lines will impact retail tariffs. Under the proposal to charge wayleaves on electricity infrastructure at a cost of Ksh200 per meter, this translates into Ksh63.8 billion per year. This is approximately 30% of the energy sector’s revenue requirements which must be recovered from the monthly electricity bills. The overall impact is that electricity will become unaffordable to a majority of Kenyans,” said Dr. (Eng.) Siror.
Section 223 of the Energy Act 2019 prohibits any public entity from charging levies on public energy infrastructure without regulatory approval.
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