Kenya Power needs to change how it communicates electricity bills

By MUNGAI KIHANYA

The Sunday Nation

Nairobi,

26 March 2023

Ever since the introduction of prepaid electricity meters in Kenya, consumers in this billing system have persistently complained about the method that the utility company uses in arriving at the number of units for different amounts of money. Indeed, many customers believe that there are different tariffs for pre-paid and post-paid meters. This is simply not true: the two systems apply the exact same rates – down to the last cent.

The rates are as follows: customer who consume less than 100 units are charged a “lifeline” tariff of Sh7.70 each. Those whose monthly consumption is more than 100 units pay Sh12.60 – “ordinary” tariff. However, this is not the total cost of electricity. This is the only money that remains with Kenya Power – the energy or consumption charge.

There are taxes, levies and “adjustments” that are added and they can push the final cost to more than double the above figures. The problem is that the adjustments change from one month to the next. For example, this month (March 2023), the total additions stand at Sh15.32 while in February they were Sh13.03.

For this reason, the number of units that are allocated for a particular amount of money varies every month. For example, for customers on the ordinary tariff, the total cost per unit in February was Sh25.63 (Sh12.60 base rate + Sh13.03 levies and taxes) while in March it is Sh27.92 (Sh12.60 + Sh15.32).

I think this misunderstanding can be solve by changing the way that the rates are communicated to the public. The Energy and Petroleum Regulatory Authority (EPRA) should adopt a method similar to what it uses in petroleum pricing. Every month, EPRA should work out the amounts of applicable levies and adjustments and publish them in the press. Then Kenya Power simply applies these rates in working out the number of units without the need to give detailed breakdowns of all charges.

The confirmation of payment message would read: “amount received = ‘X’; applicable total cost per unit = ‘Y’; number of units = ‘Z’. This is not only simple and straightforward but will also help the public track down the movement of electricity unit cost from one month to the next.

For example, if a customer on the ordinary tariff sends Sh1,000 on the prepaid system this month, they would a message saying: “Amount received = Sh1,000; Applicable total cost per unit = Sh27.92; number of units = 35.82kWh”.

Wouldn’t this be more meaningful and easier to understand than the current method?