Energy regulator eyes more revenue in new proposals

From left: CS Monica Juma, Petroleum PS Andrew Kamau Nganga and Epra Director General Daniel Kiptoo at Kawi office in South C. [Edward Kiplimo,Standard]

The Energy and Petroleum Regulatory Authority (Epra) is set for a significant rise in its revenues increase if new proposals to increase the money paid by fuel and electricity consumers pass through.

The Statute Law Miscellaneous (Amendments) Bill, 2022 by the National Assembly Leader of Majority Amos Kimunya has proposed amendments to the Energy Act, 2019, which include increasing the Epra levy from 0.5 per cent to one per cent.

The current law stipulates that among the sources of funds for the energy industry regulator include “levies not exceeding one half of a per cent on the sales of electricity and petroleum products.”

The amendments however propose deleting the phrase "half of a”, which would leave the Authority’s levy at one per cent of sales of electricity and fuel. Epra currently earns three cents for every unit of electricity consumed by Kenyans and another 25 cents per litre of fuel bought at the pump.

The Bill, which is going through the public participation phase, has also proposed the scrapping of the Nuclear Power and Energy Agency (NUPEA).

This is in line with the recommendations of the Presidential Taskforce on the Review of Power Purchase Agreements (PPAs).

The task force in its report published in September 2021, noted that the country is unlikely to start power production through nuclear energy sources and recommended that the functions currently undertaken by NUPEA, which are largely public awareness, be transferred to the Ministry.

“The Bill proposes to amend the Energy Act to give effect to the recommendations of the Presidential Taskforce on the Review of PPAs,” reads the memorandum to the Bill.

“The proposals include overlap in functions between Epra and the Ministry of Energy, including KPLC (Kenya Power) in the membership of the Rural Electrification and Renewable Energy Corporation (REREC), winding up NUPEA and transfer its functions to the Ministry.”

The Bill has also proposed amending clauses in the Energy Act that required Kenya Power to pay consumers in case of outages or damage to equipment at a customer’s premises due to an unstable power supply.

The Bill says this would only apply if Kenya's electricity grid attained the N-I reliability status, where it can to a certain degree withstand unexpected failure.