System loss denying clients lower power bills - Chirchir

Kenya Power last month announced a 13.7 per cent drop.

In Summary

•The government, through utility firm Kenya Power has a target of cutting system losses to an average 20 per cent in the short-term.

•Meanwhile, Kenya has received the backing of the European Union in clean energy transition drive.

Kenya Power staff at work.
Kenya Power staff at work.
Image: FILE

System loss contributes is denying customers lower electricity bills, with Energy cabinet Secretary Davis Chirchir saying Kenya Power has to cut to an average 20 per cent in the short-term.

At the moment, losses reported by Kenya Power have remained above the allowed limit as the firm struggles to supply reliable power.

An analysis shows that system losses hit 23 per cent in December last year, meaning that the utility firm lost 1,578.9 Gigawatt-hours (GWh) that it bought between July and December.

The Energy and Petroleum Regulatory Authority (EPRA) benchmark is set at 18.5 per cent.

The losses stood at 23.49 percent in December 2022, up from 22.43 per cent in a similar period of 2021 and 25.21 percent a year before.

Africa’s system losses are however averaging 20-40 per cent, meaning Kenya is among the well-performing.

System loss is the difference between total net generation and energy sales on the system expressed as a percentage of net generation. These losses accrue from leakages due to illegal connections or shaky transmission.

Chirchir said the government is determined to double energy efficiency in to help further cut electricity costs.

This comes as increased hydropower generation coupled with back-to-back fuel prices drop and stable shilling continue to see households and industrial installations continue to enjoy cheaper electricity bills in the country, which went down by 13.7 per cent last month.

System losses come from both technical and commercial losses with technical losses being occasioned mainly by an inefficient distribution infrastructure., while commercial losses arise from power theft.

According to Chirchir, doubling energy efficiency will help improve energy security, reduce the expenditure of foreign currency reserves on energy imports, lessen the strain on national grid during peak time and lower the costs associated with emissions.

“As we cut losses we are gearing towards lowering the cost of power because once we lower our distribution and transmission losses, that directly translates through our power bills and that is what energy efficiency is all about,” Chirchir said at the ninth Annual Global Conference on Energy Efficiency, in Nairobi.

Last month, Kenya Power announced a cut in power bills pegged on fuel cost charge and foreign exchange fluctuation adjustments.

This saw domestic customers consuming less than 30 units per month pay Sh629 in April, compared to Sh729 in March 2024.

Those who consume 60 units saw their bills come down to Sh1,574 from Sh1,773, a 11.2 per cent reduction.

“We are optimistic that the prevailing macro-economic environment and the improved hydrology, which enables us to dispatch less thermal power, will sustain the benefit to our customers," Kenya Power’s Managing Director and CEO Joseph Siror said.

The Company has developed a new Strategic Plan for the period 2023/24 – 2027/28, aimed at among others, reducing system losses by identifying and fixing affected areas.

CS Chirchir said the country needs $5.3 billion (Sh696.9 billion-current exchange rate) to overhaul power transmission lines and forestall frequent blackouts.

This was more than 20 times the $250 million (Sh32.9 billion) that it had for grid upgrades.

Meanwhile, Kenya has received the backing of the European Union in clean energy transition drive, with the launch of the Green Resilient Electricity System Programme at the Nairobi meeting on Tuesday, by European Commissioner for Energy Kadri Simson and CS Chirchir.

This is with the support of Global Gateway, Europe's investment strategy for the world.

The Green Resilient Electricity System Programme will support Kenya’s goal of a complete transition to 100 per cent clean power generation by 2030.

It will boost Kenya's sustainable energy future by providing critical investments and capacity-building measures to expand the country's production of green electricity as well as improving grid stability and efficiency.

“The programme will support Kenya’s socio-economic development and green transition. It boosts the renewable energy sector by increasing electricity generation capacity, through additional generation from hydro, geothermal and solar sources, and strengthening reliability and efficiency of the transmission system,” Simson said.

The Programme has been developed under EU’s Global Gateway initiative in close cooperation with the Kenyan government and the Team Europe partners- KfW and EIB.

It will provide technical assistance and capacity building for the Kenyan implementing partners to ensure the successful and timely implementation of the project components.

Team Europe and Kenya are investing up to Sh36 billion (EUR 256 million) to finance the programme, including the contribution of Sh2.8 billion (EUR 20 million) in grants provided by the EU.

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