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October 19, 2018

Power bills to go down as Uhuru orders levy scrap

A Kenya Power prepaid customer update her KPLC token in Loresho On April 25,2018./ENOS TECHE
A Kenya Power prepaid customer update her KPLC token in Loresho On April 25,2018./ENOS TECHE

Power bills could soon go down following a directive by President Uhuru Kenyatta to scrap some levies.

About 77 per cent of what Kenyans pay goes to tax, with the rest going to units, the Senate Energy committee heard recently.

ERC director general Pavel Oimeke said fixed energy charges take 24.8 per cent while thermal or fuel costs which vary due to water levels – currently takes 27.7 per cent of the total bill.

VAT, forex and inflation take 13.6, eight and three per cent respectively, while Water Resource Authority takes 0.1 per cent of the total cost.

National Treasury CS Henry Rotich will today meet his Energy counterpart Charles Keter for discussions.

A report on the eighth Presidential round-table with Kenya Private Sector Alliance held last week indicates the two cabinet secretaries will meet to agree on scrapping the Water Resource Management Authority and Energy Regulatory Authority levies.

SH10 LESS

Each of the two levies accounts for 0.001 per cent of total power bill.

The Rural Electrification Programme which accounts for five per cent of the base rate is also expected to be scrapped.

The two were directed to cut the Foreign Exchange Rate Fluctuation Adjustment tax from current $0.16 (Sh16 ) to 0.9 (Sh9 ) as well as plan on the establishment of Fuel Cost Charge stabilisation fund meant to keep electricity prices stable and predictable.

The government is also expected to review Time of Use Tariff in its bid to provide quality and affordable energy to the private sector to power Uhuru’s Big Four agenda.

The expected review of power bills will see Kenyans now pay at least Sh10 less for 50kWh from the current Sh24.03.

Rotich and Keter are expected to give feedback to the Presidential Round Table chaired by the President on Friday.

Kenyans have taken to Twitter to complain about higher power bills under the hashtag #SwitchoffKPLC.

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