Reprieve at last for consumers as electricity cost is set to drop this week

The Energy Regulatory Commission ERC has scrapped the Ksh 150 fixed charge on electricity, cutting down domestic consumers’ retail tariff by 36 per cent and reducing fuel energy cost to 2 shillings and fifty cents per unit. This means that one kilowatt of electricity will cost 16 shillings and 64 cent, down from the previous 17 shillings and 77 cents.

“To ensure that there’s equity and consumers pay for power only when they consume, all fixed charges for all consumer categories have been removed. This is meant to reduce the many cost items in the customer bills & simplify understanding of the bills,” the energy regulator said in a tweet.


Energy tariffs have been a thorny issue in Kenya, causing widespread outcry among consumers and the manufacturers.

Despite a steep rise in the generated energy and a growing mix of wind, solar and geothermal, the cost of energy is considered to be high by the World Bank.Under the new regime the 150 shillings standing charge has been abolished while the fuel cost charge will drop to Sh2.50 per unit from Sh4.60 in July.

Foreign exchange adjustment will reduce to five cents in August from Sh1.22. Inflation adjustment, which is revised every six month will be charged at five cents from 52 cents. However, the energy regulator has left the Water Resource Management Authority-WARMA, Rural Electrification Authority – REA and ERC Levies unchanged.

Kenya Power will have to improve its distribution channels, with ERC cutting system loss factor from 16% to 15 percent starting August this year. Commercial and Industrial customers on the average will get a reduction of 4.4%. This is in addition to the 50% discount in the time of Use Tariffs and the proposed Special Economic Zone tariff.

For large Commercial consumers and Industrial consumers, the government will be encouraging them to expand consumption by deepening the Time of Use Tariff application in the Tariff Control Period.

Despite the efforts by the energy regulator to rein in energy tariffs, power bills are likely to be impacted by inflation charges, fuel cost and forex exchange variations which are beyond the control of the government.

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