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Electricity prices to surge by up to 63% in latest power tariff review
Energy and Petroleum Regulatory Authority (EPRA) has announced a significant increase in electricity prices effective from April 1, 2023.
The new tariffs will see consumers using 30 units and below pay KES 12 per unit, up from KES 10, while those using eleven and ten units will pay KES 15.80 per unit.
The Lifeline Tariff band has been reduced from 100 kWh per month to 30 kWh to cushion and address the needs of low-income households in the society.
The request by Kenya Power, submitted to EPRA in October 2022, for a necessary review of the unit prices, has been approved, enabling the distributor to generate a net earning of KES 184.9 billion in the Financial Year 2023/24.
EPRA’s Director-General, Daniel Kiptoo, noted that higher tariffs by Kenya Power were necessary to get enough money to repair or replace ageing distribution systems.
“This will meet energy purchase costs and allow for system expansion,” he added.
The regulator also announced that on average, commercial and industrial consumers will realize a reduction of KES 1.15 per kWh, which EPRA hopes will help spur economic activities of the manufacturing industries and lower the cost of goods.
EPRA’s review on the cost of electricity is the first since 2018 when the regulator revised electricity prices to KES 10 for those consuming between eleven to ten units.
The latest tariff review also provides for Bulk Tariffs at the retail level, meaning large consumers can buy power from Kenya Power in bulk and retail it to the final consumer in line with Section 163, Energy Act. This was hinted at by then- Energy Cabinet Secretary, Davis Chirchir, during his vetting.
Electricity tariffs have been a hot topic, with Chairperson of President William Ruto’s Council of Economic Advisors, David Ndii, warning that Kenyans must choose between expensive electricity available all day or cheaper electricity available for only a few hours a day in February.
Ndii pointed out that the high cost of electricity was influenced by the aging transmission and distribution network.
Ruto promised to revamp the transmission and distribution network, accelerate geothermal resources development, and develop a Liquified Natural Gas (LNG) storage facility in Mombasa, which he believed would lower the cost of electricity.
The EPRA’s latest tariff review is expected to have significant implications for consumers, with increased costs for households, but lower costs for commercial and industrial consumers.
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