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It is not known who initiated the proposed revision of electricity rates, which is expected to come into effect from this month. According to the document from the Energy Regulatory Commission (ERC), it is a Commission initiative to "harmonize tariffs in order to … simplify the understanding of invoices". Electricity for customers ".
a proposal to raise rates – clear and simple! I used my current electricity bill (May-June consumption) to test this. I consumed 351 kWh during this period and the "energy load" was 3,962.75 shillings. The addition of the permanent load Sh150 to this brings the total to Sh4.112.75. To be clear, it is necessary to add adjustments, taxes and fees.
The proposed tariff removes the permanent tax. To recover the loss of income, the consumption limit is reduced from 50 kWh to 15 kWh and the "normal" tariff for domestic consumers is increased from 12.75 to 16.50 shillings
. bill, here are the results: the first 15 kWh billed at Sh2.50 to cost Sh37.5. The rate for the remaining 336kWh is Sh16.50 to make Sh 5444.
The addition of these two amounts brings the total to Sh5,581.50. That Sh1,469 more than what I pay now; or 36 percent more! Such an increase can not be attributed to "tariff harmonization"; it is a price increase
For this reason, I do not think that the CER is frank about this proposal. In addition, the new rates come into effect with consumption recorded from July 1, but the commission conducts public hearings from July 2 to 12.
Even though the new rates will be made on the bills starting August 1, I do not think that there will be enough time to badyze the public's views and incorporate them into the final rates.
There is also another question: is there a justification for the increase in rates? In my opinion, there is none. First of all, Kenya Power does not face any revenue constraint – at least not according to its audited financial statements. During the fiscal year ended June 30, 2017, the company realized a profit of 10.9 billion shillings (excluding taxes) for a turnover of 120 billion shillings.
Secondly, the company is protected against inflation by the "inflation" commission. In my current bill, Sh0.42 has been added for that.
If Kenya Power needs additional money for network improvement and expansion, it should do what its sister, KenGen did a few years ago: a "supply of rights". It is not wise to raise capital from customers!
It is true, however, that the billing method needs to be simplified so that customers can understand it. The public complaints about this started when Kenya Power introduced the prepaid token system
My point of view is that the problem is not in the tariff structure but in the way Kenya Power communicates the number tokens purchased. Until the communication is changed, the complaints will not end.
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