KPLC to recover from consumers Sh6.5 billion lost in Ruto tariff-cut extension

Kenya Power has been granted approval by the Energy and Petroleum Regulatory Authority (EPRA) to recover Sh6.5 billion in revenue lost during the three-month extension of the 15 per cent tariff cut, initiated by President William Ruto's government shortly after taking office.

The revelation was made in the company's latest annual report, signalling potential increases in power bills for its 9.2 million customers amidst a backdrop of escalating fuel costs, currency depreciation, and electricity tariff reviews.

In the preceding year, former President Uhuru Kenyatta implemented a one-year 15 per cent tariff cut, compensating Kenya Power for the revenue loss.

However, the Ruto administration extended the tariff cut by an additional three months until April 1 of this year without outlining a compensatory mechanism for the power provider, creating a fiscal challenge.

In the annual report, Kenya Power highlighted the absence of interventions to cover the deficit during the extended period, stating, "Unlike the preceding 12 months period of reduction for which interventions to cover the deficit had been provided, there was no intervention for the extended period."

The Sh6.5 billion loss has now been officially confirmed by EPRA and is slated to be recuperated through pass-through mechanisms.

The move is anticipated to impact consumers directly, adding to the financial burden in an environment where electricity prices have already risen due to increased fuel costs, currency depreciation, and ongoing tariff reviews.

Kenya Power, having already implemented a tariff hike in April, is now set to deduct the Sh6.5 billion from consumers, compounding the challenges faced by domestic consumers who are currently paying approximately Sh33.10 per unit of electricity—an increase of 26 per cent from December's Sh26.29.