Electricity distributor, Kenya Power, has announced plans to increase electricity prices by up to 20% and is already in talks with the Energy and Petroleum Regulatory Authority (EPRA) regarding the same.
If the application is approved, Kenya Power will increase charges for consumers using less than 100kWh per month to KSh12.5 per unit up from KSh10. The company will also increase costs for customers who use more than 100 units per month to KSh19.53 per unit up from the current KSh15.80
The Energy ministry argues that Kenya Power needs more cash to cover the cost of buying wholesale electricity from generators such as KenGen and maintenance of the national grid, hence the proposed hikes.
The cost of buying electricity from power generators such as KenGen jumped by KSh18 billion last year, blunting the impact of an increase in sales.
The company has lost approximately KSh5.6 billion in revenues between March and June this year, citing low power consumption due to the global COVID-19 pandemic. Electricity consumption declined by about 14.8%, corresponding to a decrease in energy consumption by about 341 GWh. Consequently, electricity sales revenue reduced by about KSh5.6 billion.
The electricity distributor already issued a profit alert, meaning the utility’s net earnings are projected to decline by at least 25% compared to last year’s net earnings.