Kenyans will start to enjoy cheaper electricity from December this year.
This was announced by President Uhuru Kenyatta on Wednesday.
The cost of reduction will be achieved through the reduction of the consumer tariffs from an average of Ksh.24 per kilowatt-hour to Ksh.16.
The President has already tasked Energy Cabinet Secretary Charles Keter to implement the measures.
This is after the President received the Report of the Presidential Taskforce on Review of Power Purchase Agreements which was constituted to respond to calls from a wide cross-section of Kenyans to address concerns about the high cost of electricity for both individual consumers and enterprises.
Inside the report, it was established that there was a vast differential between KenGen and Independent Power Producer (IPP) tariffs and electricity dispatch allocations.
There was also the lack of proper demand forecasting and planning, leading to irreconcilable projections as against demand, the existing risk allocation imbalances between KPLC and IPPs were further exacerbated by poor contract management frameworks.
It was also established that there was an uncoordinated institutional architecture that inadvertently contributes to enhanced operational costs passed on to consumers.
Out of this finding, the President has directed for the reduction of the cost of electricity by over 33 percent within four months.
“The consequence of the proposed interventions is that a consumer who previously spent Ksh. 500 per month on electricity shall by 31st December, 2021 pay Ksh.330 per month. This cost reduction will be achieved through the reduction of the consumer tariffs from an average of KES 24 per kilowatt hour to KES 16 per kilowatt hour which is about two thirds of the current tariff,” said President Kenyatta through State House Spokesperson Kanze Dena.
This comes hardly a day after the Energy and Petroleum Regulatory Authority (EPRA) on Tuesday dismissed claims of being linked to hiking of fuel prices in the country.
EPRA Director-General Daniel Kiptoo while appearing before National Assembly Committee on Finance and National Planning, said the regulator had no powers to reduce fuel prices since it tabulates the pricing using a formula approved by Parliament and National Treasury.
Kiptoo further said EPRA did not subsidize fuel this month because the National Treasury did not approve use of Fuel Stabilization Fund, which it often taps to cushion consumers.
On Tuesday, Kiptoo told the legislatures that the Fuel Stabilization Fund had been used in the last four months.
However, in the last review on September 14, 2021, resources from the fund were not utilized leading to increases in Kerosene, Super Petrol and Diesel by Ksh.12.97, Ksh.7.54 and Ksh.7.94 per litre respectively, leading to public outcry.
Kiptoo said Kshs.8.7 billion from the fuel stabilization kitty had so far been spent on subsidizing fuel prices.
When legislators questioned the taxes and levies on fuel, Kiptoo said the answers lied with the legislators, the National Treasury and the Ministry of Energy who can set or revise the components of the fuel pricing formula.
The National Assembly Speaker Justin Muturi directed the Committee to table a report on the fuel price increase by EPRA within 14 days due to its urgency and effects it has on Kenyans.
The committee is also required to attach a draft bill to the report for any approval for publication proposing legislative intervention to the House.
