Chirchir sets up team to address high power costs
By George.Kebaso, June 22, 2023Ministry of Energy has established an eight-member committee to fast-track development of a strategy to identify and address the factors behind the ever-rising cost of electricity.
It hopes the report to be filed within two months will play a big role in persuading Parliament to lift a moratorium it imposed on signing new power deals.
The committee of senior officials from agencies under the Ministry of Energy which will be chaired by Eng Isaac Kiva, the Secretary in charge of Renewable Energy, has 60 days to have the document ready.
“Why don’t we set up a team that looks at the industry in the way generators are going to dispatch power to the country?” Energy Cabinet Secretary, Davis Chirchir suggested as he hosted stakeholders in the energy sector including financiers, to find a sustainable way of addressing the ever-increasing cost of electricity in the country.
He said the country cannot afford to waste any more time as the country’s economy – which highly depends on manufacturing – continues bearing the brunt of the moratorium, and eventually grinds to a halt.
In April, Parliament voted by acclamation to bar Kenya Power and Lighting Company (KPLC) from signing new power purchase agreement (PPA) deals for at least four months amid an inquiry into current agreements.
They endorsed the moratorium, a temporary freeze to pave the way for fresh investigations into the current deals between KPLC and Independent Power Producers (IPPs). And only last week, they drew a six-point plan to bring down the electricity cost as the probe goes on.
The CS was emphatic that if the moratorium was lifted, it would encourage more power generation through the Public Private Partnership (PPP) model, pave the way for competitiveness, lower power tariffs, reduce losses incurred and facilitate nationwide electricity transmission coverage.
Increased costs
The team he established is expected to have the document ready by August 18, when the stakeholders will converge again to vet it before it is presented to President William Ruto.
“We are hoping to give Kenyans some good news during Jamhuri Day celebrations when we expect the President to announce the new lower electricity cost,” said Chirchir, emphasising that the country has a huge potential in electricity generation, which it can even sell a surplus to neighbours in the region. Consumers are currently grappling with the increased costs of power following the revised tariff approval by Energy and Petroleum Regulatory Authority (EPRA) that took effect on April 1, and the moratorium is exacerbating the situation.
Under the new tariff, Kenyans using below 30 kilowatts (kWh) per month have had their electricity bills go up by 22.2 per cent. This moved the cost for this category, domestic lifeline, from Sh10 per a unit to Sh12.22 per unit.
The other category, domestic ordinary 1, with consumers between 31-100 kWh per month, had their costs go up by 63 per cent from Sh10 per unit to Sh16.3.
“To lower these costs, let’s not lock up the economy by barring others from competing in the business. Let’s allow everyone in the sector to have a stake so that we grow together,” the Cs said, vowing to take the matter to Parliament to ask Members whether the moratorium is necessary.
“we will experience challenges in power discharge in the next two to three years, if this moratorium remains in place,” Chirchir added.