- According to the article published by Business Daily, Kenya Power has been inflating electricity bills, resulting in consumers being overcharged by up to 20 per cent for power they did not use.
Kenya Power, the leading electricity distribution company in Kenya, has issued a statement in response to an article published by Business Daily on August 7, 2023.
The article "Auditor Reveals How Kenya Power Inflates Electricity Bills" quoted a report by the Auditor General before a parliamentary committee.
According to the article published by Business Daily, Kenya Power has been inflating electricity bills, resulting in consumers being overcharged by up to 20 per cent for power they did not use.
It referenced a forensic review conducted by the Auditor General, which revealed discrepancies between billed amounts and actual consumption. The report also highlighted the presence of untraceable extra charges in Kenya Power's billing system.
“In a shocking revelation before a parliamentary committee, Auditor-General Nancy Gathungu said a forensic review of generation, transmission and distribution of electricity found bills do not match actual consumption while extra charges loaded on the consumers by the utility are not traceable in the billing system.”
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In response, Kenya Power categorically denies the allegations made in the article, stating that the contents are non-factual and aimed at creating a false narrative around the cost of electricity.
The company addresses the issues raised as follows:
Regulatory Environment
Kenya Power operates in a regulated environment governed by the Energy Act 2019. All charges included in electricity bills are approved by the Energy and Petroleum Regulatory Authority (EPRA) for all categories of customers.
This ensures that the billing process follows the guidelines set by the regulator.
Computation of Electricity Bills
Electricity bills are computed based on customer consumption, which is determined by the difference between the current meter reading and the previous reading.
The approved base tariffs, levies, and taxes are then applied to the consumption to calculate the customer's monthly bill. This process ensures that customers are billed accurately based on their actual usage.
System Losses
Kenya Power acknowledges that there are inevitable losses during the transmission and distribution of power. The regulator sets a threshold for allowable system losses, which is factored into the tariff.
In the current financial year, the regulator has approved system losses of up to 18.5%. Kenya Power is responsible for covering any system losses that exceed the approved threshold.
Regulatory Checks
The regulator conducts regular checks and verification to ensure that Kenya Power charges customers based on the approved rates. This oversight mechanism helps maintain transparency and fairness in the billing process.
Power Procurement
Kenya Power procures electricity from various suppliers, including Kenya Electricity Generating Company (Ken Gen), Independent Power Producers (IPPs), and the Rural Electrification and Renewable Energy Corporation (REREC).
The company affirms that all 100 delivery points from 58 power suppliers have been verified to have both main and backup meters, as required in the Power Purchase Agreements.
