The Energy and Petroleum Regulatory Authority (EPRA) has approved a proposed 20 percent tariff hike by Kenya Power.
If implemented, the power bill increase would worsen the burden on many households reeling from the economic shocks of the Covid-19 pandemic. Manufacturers and commercial operations would also have to contend with higher operational costs in a depressed economy.
Kenya Power had submitted its application for the tariff hike in 2019, Sources at EPRA told reporters that the regulator had agreed to the increase.
To take effect, however, the tariff hike would have to be subjected to public participation.
If approved, the hike would then take effect through a Kenya Gazette announcement. Details of the higher tariffs are expected to be revealed in coming weeks.
The hike is integral for Kenya Power’s turn-around plan, with the firm currently bogged down by the cost of long-term power-purchase agreements.
For usage of less than 100 Kilowatts per month, Kenya Power wants to raise the unit price from Ksh10 to Ksh12.50.
For usage of more than 100 units, the cost per unit will rise from Ksh15.80 to Ksh19.53.
According to Kenya Power, a review of power prices was necessary after present tariffs lapsed in 2019.
EPRA had in 2018 introduced temporary tariffs that brought down power prices after a directive from President Uhuru Kenyatta.
Uhuru was reacting to widespread complaints from consumers over newly introduced tariffs that had seen their monthly bills double.
Now, KPLC argues that with the expiry of the temporary tariffs, they are justified to review the price upwards.
Approval of their application to EPRA had been delayed by the Covid-19 pandemic, causing them to write a protest letter over the delay.
The company recently issued its third profit warning in a row, with financial results expected in January 2021.