Kenya Power, City Hall tiff reveals Sh26.6 billion in power bills debts

Kenya Power Managing Director and Chief Executive Officer Joseph Siror addressed Members of the Editors Guild, during an update on Kenya Power's Corporate Strategy on March 4, 2025.[Benard Orwongo,Standard] The recent tiff between Nairobi County Government and Kenya Power has exposed how piling unpaid power bills debts are hindering it from offering efficient services to the nation. The firm also said demands by Nairobi County for it to pay Sh4.9 billion wayleave charges if granted could push up cost of power. It added that it follows the right procedure, including exhausting all measures before disconnecting power to customers. This was revealed on Tuesday during a breakfast meeting organised by Kenya Editors Guild(KEG) and Kenya Power. Editors and journalists got opportunity for the first time to ask to Kenya Power managing director Eng. Joseph Siror questions related to power consumption, high cost of tariffs, last week event among other issues. Last week, KP disconnected power to some county facilities, forcing the county to pour garbage at its headquarters in Ngara, park lorries at entrance to prevent entry and exit and disconnect water to the utility firm. On Monday, Nairobi County Governor Johnson Sakaja while appearing before the Departmental Committee on Administration and National Security, revealed that Acting Assistant Director, Debt Management James Sankale and Acting Director, Revenue Administration John Ntoiti who were responsible for the actions were interdicted. He also said that KP owed the county Sh4.9 billion in unpaid wayleave fees, while at the same time, the county government had unpaid electricity bills. On power bills, Siror said the current total debts amount to Sh26.7 billion as at March representing a 32 percent growth from Sh20 billon June 2022. Domestic power bills, which are easily collectable ranging from 190 days to six months old occupy the huge chunk at Sh13.6 billion as at start of March from Sh11.1 billion as at June 2022, representing a 22.22 percent. Siror, who urged media to highlight vandalism more, said County Governments owe them Sh4.26 billion from Sh2.30 billion in June 2022, representing an 85 percent growth with Nairobi County taking about 70 percent of the bills. Small and medium Enterprises(SME) owe KP Sh3.6 billion from Sh3 billion, representing an 18.6 percent growth. Counties are followed by National Government and State agencies, who owe them Sh3.32 million as of start of March, which has grown by 48.06 percent from Sh2.24 billion from June 2022. Speaking on Monday when he appeared before the Parliamentary Committee on Administration and Internal Security at County Hall, Director of Criminal Investigations (DCI), Mohamed Amin urged the Kenya Power to reconsider its approach in disconnecting power due to unpaid electricity bills from government institutions, some critical, warning that indiscriminate power outages could have disastrous consequences. Lastly is large power that owes utility firm Sh1.96 billion from Sh1.41 billion, a 39.1 percent from June 2022. According to Siror, despite last year making Sh230 billion revenue as per their last financial report released in October 2024, much of it goes to paying energy sector players. He said for every Sh100 that they get, Sh63 percent goes to generators, 30 to transmission, distribution, commercial services and administration of the 306 stations and 83,436 transformers covering a distance of 319,778kms, as 3 percent goes to Rural Electrification and Renewable Energy Corporation (REREC) for operation and maintenance and 4 percent goes to Kenya Electricity Transmission Company (Ketraco) for transition costs. "Despite that, the power tariff progression over the period from the financial year 2022-2023 to current 2025-2026 has been going down from 19.04, 18.86, 18.16 to currently 17.94 respectively," said Siror. He said tariff reviews are justified by power purchase costs, return on investment(RoI), taxes and levies, depreciation of the shilling and operation and management costs. However, KP warned that the enjoyment of these low tariffs may come to an end if it will be forced to pay Nairobi County Sh806 million annually for wayleaves charges, a situation which will see power costs rise by 30 percent. "The current proposal we received from the county is that we need to be paying wayleaves at the rate of Sh200 per meter and the figure they use is 4,032kms of network. If that is implemented, we shall have to pay Sh806,400,000. If we extrapolate that to the entire network of 319,000kms across the country in 47 counties applying the same rates, the cost will be Sh63.8 billion and this will cause review of the current consumer retail to up by over 30 percent," said Siror. This, he said is still an illegality citing Section 223 of the Energy Act, 2019, which prohibits public bodies from imposing levies on energy infrastructure without Cabinet Secretary approval. He added that the possible rise in tariffs will mean that manufacturing costs will rise by approximately 30 percent and make Kenya a non-competitive industry destination. Also, he said electricity will become unaffordable to the majority of Kenyans and create a non-sustainability of the energy Sector as it may impact consumption trends negatively. Siror said before they disconnect power like the way they did recently to the county, they normally follow a process which include sending a letter accompanying the billing schedule, which advises the customer on the due date for payment of the bills. "The customers are given the standard 14 days period to settle their bills. In the two weeks before payment is due ,KPLC has allocated dedicated Officers to each customer to support in resolving arising issues as necessary. The officers ensure payments are allocated as per directions from the customers and receipts are issued back. In case of delays in payment, the officers will remind the customers through phone calls, customer visits and holding formal meetings to discuss," said Siror. He added: "Finally, as a last case scenario, a written demand notice may be issued followed by the actual interruption of supply if no response is forthcoming" Siror said the power to disconnect the electricity supply to a customer who has not paid their electricity bills is drawn from section 160 of the Energy Act, 2019. For Nairobi County, he said it was after the court orders in the case of Nairobi County Government v. Kenya Power and Lighting Company Limited [2018] eKLR. Speaking at the event, KEG President Zubeida Kananu asked Kenya Power in future to see how they can avoid such dispute. "But beyond the optics, the core question remains, how do we prevent disputes between key institutions from escalating into public confrontations? How do we ensure that financial disarguments do not disrupt essential services? And most importantly, how can such issues be resolved in a way that protects businesses and households from unnecessary disruptions?" Ms Kananu asked KP to make information available by encouraging open communication. "The media shouldn't have to struggle to access information and Kenyan Power shouldn't have to fight misinformation alone. I hope today's engagement fosters a stronger relationship between Kenyan power and the media, one built on transparency, mutual respect and a shared commitment to public service," she said.

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