Electricity users to shoulder Sh20bn bill on lost power

Kenya Power lost almost a quarter of electricity bought for distribution in the first six months to December last year, a burden consumers have to shoulder through higher bills.

The bi-annual statistics report for the financial year 2024/2025 released last week by the Energy and Petroleum Regulatory Authority (EPRA) shows that 24.2 per cent of the total energy purchased by the national utility was lost.

This is an increase of one percentage point from the 23.2 per cent recorded in a similar period in the last financial year.

The rate is 6.7 per cent above the 17.5 per cent threshold allowed by the regulator for the current financial year. System losses comprise technical and commercial losses.

Technical losses are inherent to a power system and are brought about by losses in transmission and distribution lines due to the disruption of the lines, transformers and switchgear connected to the system.

Commercial losses refer to unbilled electrical energy delivered to consumers. These include losses due to power supplied to illegal connections, unmetered connections, unread meters and meter tampering.

While commercial losses are avoidable, technical losses cannot be avoided in totality but can be reduced.

Although the cost of power has gradually reduced since last year, based on stable shillings and adequate water for generation, system losses are denying consumers benefits as they split losses with the power utility.

The regulator allows the power distributor to recover 19.9 per cent of the losses from consumers while it bears the cost of losses above this threshold.

According to energy experts, a single percentage of system losses equals Sh1 billion in lost revenue. This means that power users will eventually pay close to Sh20 billion while another Sh3.8 billion will be deducted from the firm’s profits.

The power utility recovered Sh19.3 billion from consumers for system losses in a similar period last year. The country is aiming for a loss of 14.5 per cent, a move that could see the cost drop to Sh13.11 billion.

According to the report, system losses reduced gradually during the period from a high of 24.9 per cent in July to a low of 23.7 per cent in December last year.

Appearing before the National Assembly’s Departmental Committee on Energy late last year, Kenya Power boss Joseph Siror said that while his firm has put in efforts to reduce system losses, there was a surge in losses on the medium-voltage networks during the year.