Electricity costs in Kenya have been on a steady decline over the past year, driven by the strengthening of the Kenya Shilling against the US Dollar, Kenya Power has reported.

However, the company has raised concerns over proposals to introduce wayleave charges on power infrastructure, warning that such a move could push electricity prices up by as much as 30 per cent.

During an engagement with the Kenya Editors Guild, Kenya Power's Managing Director and CEO, Dr. (Eng.) Joseph Siror, explained that the appreciating shilling had led to lower pass-through costs for customers, particularly in forex and fuel charges, which are directly influenced by the dollar exchange rate.

"This has added to the gains from the decline in the base energy cost following a review of the electricity tariff in April 2023, which put in place a three-year tariff that provides for a lower cost per unit, starting in July of each of the three years," Siror stated.

"So far, the base tariff has declined from Sh19.04 per unit in 2023 to the current Sh17.94."

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Despite this progress, the company has expressed concern that the proposed introduction of wayleave charges on electricity infrastructure could wipe out these gains.

Kenya Power has a vast network of over 319,000 kilometres of power lines across all 47 counties, and Siror warned that if wayleaves were introduced at a rate of Sh200 per metre, the annual cost would amount to Sh63.8 billion.

"Kenya Power has over 319,000 kilometres of power lines across all 47 counties. The introduction of wayleaves on power lines will impact retail tariffs," Siror added.

"Under the proposal to charge wayleaves on electricity infrastructure at a cost of Sh200 per meter, this translates into Sh63.8 billion per year."

According to Siror, approximately 30 per cent of the energy sector's revenue requirements must be recovered from the monthly electricity bills, and the overall impact is that electricity will become unaffordable to a majority of Kenyans.

Kenya Power further pointed out that Section 223 of the Energy Act 2019 prohibits public entities from imposing levies on public energy infrastructure without regulatory approval.

As the debate on wayleave charges continues, consumers may have to brace for possible changes in electricity costs.