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Uganda overtakes Kenya in taming electricity losses

BUSINESS
By Macharia Kamau | March 24th 2020

Engineers from the Kenya Power and Lighting Company (KPLC) go through a major maintenance work to upgrade the Shimanzi Power sub-station to have Mombasa residents experience interruption free electricity supply through its programme dubbed "Boresha Umeme" in 2014. [File]  

Uganda’s power industry players are doing much better than their Kenyan counterparts in preventing losses that occur during electricity transmission.

The country’s power distributor Umeme yesterday reported that the industry has been able to bring down power losses to 16.4 per cent as of December 2019, from a high of 24.3 per cent in 2013.

This is in comparison to Kenya’s transmission losses of 23 per cent as of December 2018, according to the latest available data - from 16 per cent in 2010.

The low power transmission losses have, however, not translated to cheaper power for Ugandans as they pay the highest charges in East Africa.

Uganda’s domestic consumers pay a base tariff of Sh21 (USh769) per kilowatt-hour in comparison to Kenya’s Sh15.80 per unit.

The Kenya Power losses stem from dilapidated transmission infrastructure as well as outright theft at times facilitated by staff. This plays part in pushing up the cost of power, as the firm passes these losses to its customers.

Umeme noted that it could have brought the losses further down were it not for delays owing to regulatory approvals for investment aimed at reducing the losses.

“Whereas we reported energy losses of 16.9 per cent at half-year, we further reduced losses to 15.9 per cent in the second half leading to an annual average of 16.4 per cent,” said Umeme when it published its financial results yesterday.

Umeme attributed the marginal reduction in the annual average to delayed approvals of investments in the in technical loss reduction projects and limited operational resources.

“With the revised parameters agreed later in the year, the ability to address losses is now significantly improved and is being realised in the early stages of 2020,” it said.

As of December 2018, power losses stood at 23 per cent.

It is estimated that one per cent of power losses translate to a revenue loss of Sh1 billion.

The power distributor is allowed to recover up to 14.9 per cent of the power transmission losses from electricity consumers.

According to Kenya Power’s annual reports, the losses have been growing - from 16 per cent in 2009/2010 financial year to 20.5 per cent in the year to June 2018.

In its report for the half-year to December 2018, the firm said this had worsened to 22.8 per cent during the six months despite massive investments to improve transmission.

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