25 January 2014

Kenya: Power Bills Rise On Review of Forex Rate

Electricity consumers will pay slight higher per unit on their January bills following Kenya Power's upward revision of the foreign exchange rate fluctuation adjustment component.

The utility firm gazetted a new forex rate fluctuation adjustment tariff for January metre readings, which is more than double the previous month's per kilowatt hour.

"Pursuant to clause 2 of part III of the Schedule of Tariffs 2013, notice is given that all prices for electrical energy specified in part II of the said schedule will be liable to a foreign exchange fluctuation adjustment of plus 34 cents per kWh for all meter readings taken in January 2014," reads the notice by company secretary Laurencia Njagi.

December readings were billed at plus 15 cents per kWh on the forex rate component. The current charge of 34 cents per unit is thus 126.7 per cent higher.

The forex rate fluctuation adjustment is a variable component reflecting foreign currency-based costs such as electricity project loans repayments incurred generation and distribution. It is dependent on the shilling's strength against major world currencies in a given period and is adjusted monthly.

An electricity bill has other components surcharged monthly besides the fixed charge such as the fuel cost charge, which has been retained at the same level as in December at Sh5.19 per unit.

The new schedule of tariffs, effected from last month, requires domestic users to pay a fixed charge of Sh120 and energy charges of Sh2.50 per unit for up to 50 units consumed, Sh11.62 per unit for 51-1,500 units and Sh19.57 per unit for units above 1,500. Variable charges apply as gazetted.

Non-domestic small commercial consumers - which do not exceed 15,000 units - are now paying a fixed charge of Sh150 and an energy charge of Sh12 for each unit consumed.

However, from July 1, domestic consumers will start paying a fixed charge of Sh150 and energy charges of Sh2.50 per unit for up to 50 units consumed, Sh13.68 per unit for 51-1,500 units, and Sh21.57 per unit for units above 1,500.

Non-domestic small commercial consumers and commercial and industrial consumers will also see their static charges go up six months from now as per the new schedule.

A typical monthly bill's components include the fixed and consumption charge -payable to Kenya Power - and forex adjustment and VAT which are remitted to the government.

Kenya Power also collects the fuel cost adjustment on behalf of KenGen and independent and emergency power producers for units supplied in the period, ERC levy for the Energy Regulatory Commission and the rural electrification programme levy for the Rural Electrification Authority.

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