• Tuesday, 21 May 2024
Senators plan to demolish Kenya Power's monopoly.

Senators plan to demolish Kenya Power's monopoly.

Senators now want KenGen to be allowed to sell electricity directly to consumers in order to reduce the high cost of lighting by breaking the monopoly held by Kenya Power.

They also want a review of contracts awarded to independent power producers (IPPs), which they consider punitive.

KenGen supplied 8,443 gigatonnes of electricity in the fiscal year ending June 2021, accounting for 70% of the total power supply, and was paid Sh44.8 billion, according to Senate Energy Committee Chair Wahome Wamatinga.

IPPs, on the other hand, supplied 3,000 gigatonne hours, or less than 30% of total power, but were paid more than Sh56 billion.

The amount paid if KenGen supplied 100 percent of Kenyans' power consumption would have been Sh64 billion, saving the country Sh34 billion, according to the Nyeri senator.

He explained that the difference is caused by KenGen charging Sh5.41 per unit, whereas IPPs charge between Sh9 and Sh173 per unit and are paid in US dollars rather than Kenya shillings.

Kenya Power must also pay for what is generated by IPPs, whether or not it is consumed.

"As a committee, we note that the cost of electricity charged by IPPs is 30 times that of KenGen," Mr. Wamatinga said.

He claims that this means that for Sh1,000, one can only get 40 units of electricity, while Sh100 gets one four tokens, despite the fact that energy is a critical factor in production.

"If we want to industrialize and attract international manufacturing firms, manufacturing costs must be reduced by lowering the high cost of electricity," he said.

Although Kenya Power is a monopoly and should be profitable, he claims, it is plagued by governance and accountability issues, with audited accounts as of June 2021 revealing a liability of Sh116 trillion against assets of Sh49 trillion.

Kenya made costly deals with IPPs, raising the cost of electricity in Kenya to exorbitant levels, lamented Nairobi Senator Edwin Sifuna, who called for a complete overhaul of the energy sector.

Surprisingly, the contracts range in length from 23 to 27 years, with the majority expiring in 2030 and others lasting until 2043.

"We must advocate for a reduction in power charges, which are killing Kenyans." Residents in Mukuru, for example, rely on informal connections to survive. "This is due to the fact that Sh100 can only [buy] three tokens," Mr Sifuna explained.

Tana River Senator Danson Mungatana has called for the prosecution of those who signed punitive contracts with IPPs.

Senator Samson Cherargei of Nandi added that Director of Public Prosecutions Noordin Haji should ensure that prosecutions of individuals who oversaw the purchase of faulty transformers, which he blamed for the frequent power outages, are completed.

According to him, there are 800 faulty transformers in Nandi alone, with another 10,000 sitting idle at Kenya Power's Roysambu yard in Nairobi.

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