Manufacturers set for further electricity billing relief in tariff adjustment


Manufacturers set for further electricity billing relief in tariff adjustment
PICTURE/COURTESY

In Summary

  • New tariffs, gazetted by the industry’s regulator on Friday sees commercial and industrial consumers metered by Kenya Power at 220,000 volts per post-paid billing period pay Ksh.7.99 for every unit consumed.
  • Consumers will further account for a lesser Ksh.3.99 for each unit of power consumed outside peak hours with the demand charge per kilovolt amperes (kVA) being set at Ksh.200.
  • The adjustments build on the industry expectations for cheaper power to move the sector away from the narrative of available but expensive electricity which continues to leave unused power in the national grid from the resulting lowered demand.

Manufacturers and other heavy commercial power consumers are set to see further relief in their end-month billing as the Energy and Petroleum Regulatory Authority (EPRA) introduces a new class of tariffs.

The new tariffs, gazetted by the industry’s regulator on Friday sees commercial and industrial consumers metered by Kenya Power at 220,000 volts per post-paid billing period pay Ksh.7.99 for every unit consumed.

The consumers will further account for a lesser Ksh.3.99 for each unit of power consumed outside peak hours with the demand charge per kilovolt amperes (kVA) being set at Ksh.200.

The newly scheduled tariff is carried as part of amendments to the 2006, Energy Act which were implemented first on July 1, 2018 and signal further reductions to electricity costs for heavy power consumers by adding a class above the 132,000 volts metered customers.

Moreover the adjustments build on the industry expectations for cheaper power to move the sector away from the narrative of available but expensive electricity which continues to leave unused power in the national grid from the resulting lowered demand.

The Kenya Association of Manufacturer (KAM) has been at the forefront of the push for power affordability warning of a grim industry outlook  in the country as cost inputs slowdown the competitiveness of Kenyan goods against those produced by regional peers.

The industry lobby has continued to fight it out for the redress of the high power costs while noting that only a single digit tariff per kilowatt hour (Kwh) of consumed power can deliver the desired sector’s contribution to Gross Domestic Product (GDP) of 15 percent by the year 2022.

Previous attempts to bring down the cost of power through a combination rebates and off-peak tariffs have run into hurdles while manufacturers have argued of the short-timed nature of the interventions.

The off-peak/ night time tariffs have for instance been ineffective as the majority of manufacturers struggle to meet the terms and conditions which for instance require firms to run production lines both in the night and day.

Meanwhile, the recently gazetted 30 percent power rebates have meanwhile faced backlash from industry players who fault the qualification of firms by virtue of profitability.

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Story By Kepha Muiruri
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