Tough times ahead as power cost is set to rise

By MACHARIA KAMAU

The cost of living is set to go up substantially as electricity tariffs rises following rain failure over the March-May long rains season.

The rise in cost of electricity is among the oncoming shockers that Kenyans should expect in the coming months, the dry spell over the traditionally rainy months between March and May. Poor weather is also likely to result in a spike in the prices of food. A March research by Ipsos Synovate found the rising cost of living is seen by more than half of Kenyans as the most serious issue of concern.

The Kenya National Bureau of Statistics in April noted that prices of most food items have been on the rise in the recent past while the ministry of agriculture already warned that maize production might dip this year because of poor rains.

Energy Regulatory Commission yesterday said the fuel cost charge on power bills would go up beginning this month as power agencies engage thermal power producers to meet local demand for electricity.

In addition to their own power bills going up, the rise in cost of electricity is also likely to see prices of consumer goods going up. This is also expected to hit manufacturing firms and other heavy power users. 

The latest surge in power prices is despite numerous assurances from government agencies that Kenyans will soon be paying lower rates for power.

ERC said the poor rains would see power generation shift to a heavy dependence on thermal power producers that burn diesel to generate electricity.  This is due to decline in the amount of power generated at the Seven Forks hydroelectricity dams, which are low on water and generation capacity has fallen by about a half.

Generating electricity using the more expensive fossil fuels usually has a result of increasing the power costs as the cost of fuel is passed to consumers by the power producers.

The energy industry regulator said Kenyans will beginning end of this month pay higher power bills in fuel cost charge. The fuel cost charge will go up 40 per cent to Sh7.22 from the previous Sh5.19 per unit of electricity consumed.

 “Masinga Dam, which is the main reservoir for the Seven Forks cascade, is only 32.6 per cent full compared to 100 per cent at the same last year. The average inflow into Masinga in April this year has been 53.6 cubic metres per second compared to 417.9 cubic metres per second in April last year,” said ERC in a statement yesterday.

“With reduced hydro power generation and in order to continue meeting the national demand, it is imperative therefore to enhance the level of power generation from thermal plants with immediate effect to replace hydro capacity.”

“As a result, the fuel cost charge on in customers’ bills will rise from the current Sh5.19 to Sh7.22 starting with the May bills going forward.”

The shift to relying on thermal power producers comes on the background of delayed commissioning of geothermal power plants in Olkaria.

Two plants with a combined capacity of 140 megawatts were expected to be commissioned by April this year, which would have reduced overreliance on hydro and even eliminate the need to engage power producers in the event the rains failed.

A new schedule of commissioning shows that four plants — with a combined capacity of 280MW — will be commissioned by September, starting with a 70MW one that will start feeding into the national grid on June 24.