Speaking to the press on Tuesday, September 7, Parliamentary Energy Committee Chair, David Gikaria, argued that the spike in power costs was caused by expensive deals power manufacturers had signed with Kenya Power.
The lawmakers blamed the deals signed by the power producers for yearly losses suffered by Kenya Power.
He further noted that the pricing tariffs given by the producers to Kenya Power was double to what it had signed with Kenya Electricity Generating Company (KenGen).
“Kenya Power has no choice. These agreements are signed by Kenya Power themselves and the IPPs (Independent Power Producers) and they have had that capacity charge whether they take the power or not, the will still have to pay,” explained Gikaria.
“That is where you can see the problem of Kenya Power. They are going under year-in-year out just because of this.”
The committee seeks to tone down the demands by private power producers, which would in turn lower the prices for consumers.
In the past year, Kenya Power recorded a spike in electricity prices for consumer even as the economy took a beating from the Covid-19 pandemic.
In a past interview, Kenya Power Chief Executive Officer, Benard Ngugi, confirmed that the company needed have cash set aside to cover the cost of buying wholesale electricity.
“It’s obvious that if the cost of electricity from generators comes down, the same will go to the economy or wananchi (customers) by the regulator also reviewing the retail tariff downwards.”
“It would be very good if the economy gets the benefit of cheaper power to spur growth through manufacturing that heavily relies on electricity rather than merely to think of electricity players making money,” he stated.
As of March 2021, the electricity had increased by Ksh1.20 per unit for households.