Why your electricity costs are high, Kenya Power CEO Joseph Siror explains

Kenya Power Chief Executive Joseph Siror during an interview on Spice FM on Tuesday, August 15, 2023. [Elvis Ogina,Standard]

Kenya Power Chief Executive Joseph Siror has shed light into the technicalities that drive electricity costs to be high.

Siror, in an interview with Spice FM on Tuesday, August 15, said that the low rains and dam levels in the country have limited the amount of power that can be dispatched from the hydro plants, which are the cheapest source of electricity.

His statement coming even as prices of electricity of electricity in the country hit an all-time high.

In the latest data from the Kenya National Bureau of Statistics (KNBS), the average price of 50 kilowatts/units (kWh) of electricity has increased from Sh796. 83 in August last year to a mean of Sh1,326.54 at the end of May this year.

Siror said whenever there is a shortfall, the diesel generators, which are more expensive, have to fill the gap.

"Whenever there is that shortfall, what mainly comes in to fill that gap are the diesel generators, which means it will keep varying from month to month based on how much hydro was dispatched in that particular month to meet the requirements," he said.

He further explained that some stations run on thermoelectric generators, which use diesel to meet the entire consumption. He added that there are transmission and distribution losses that occur when power is generated and transmitted to the end users, who are billed for what reaches them.

"The moment you generate power and you transmit, there are transmission losses. The moment you distribute, there will always be distribution losses, so what eventually becomes available to be sold is what reaches the end user and that is what is billed to the customer," he explained.

The recently appointed Kenya Power boss said that the tariff that is passed to the consumer today is a summation of all the requirements for the energy sector, including the cost of generation, transmission, distribution and retailing, as well as some levies to support some of the energy sector agencies.

He added that Independent Power Producers (IPPs) came in to fill the demand and increasing population, saying that the power consumption in Kenya varies from low to high depending on the time of the day and the season.

"When you look at the power consumption in Kenya, there is a curve; like for example today if I was to communicate with national control, we may be consuming around 1600 megawatts but by 9:00am we may actually have gone to around 2000 megawatts. There is a curve that varies from low to highs and then from around 10 pm it drops to around 1500 megawatts and then by midnight we are again back to around 1000 megawatts and that is how the power curve is," he said.

During the time when the power consumption is lower, they may not need to dispatch the more expensive sources because they can meet that demand by just dispatching the cheaper ones. But when the peak demand is higher, they have to inject the more expensive ones to avoid load shedding.

"If there is a way we can encourage more power usage especially during off-peaks, it would be possible to mitigate against the cost."