Kenya Power extended a welcome relief to Kenyan consumers on Wednesday, February 7, by announcing a reduction in token charges in its latest electricity price review.
Alex Wachira, the Energy Principal Secretary, disclosed that electricity costs across all categories would decrease by Ksh3.44 per unit.
This reduction was attributed to a drop in the foreign exchange adjustment rate, plummeting from Ksh6.46 to Ksh3.22.
The foreign exchange adjustment rate determines the forex charge deducted during token purchases and fluctuates based on the exchange rate between hard currencies and the Kenyan Shilling. Presently, the dollar is valued at Ksh160.
Prepaid users began benefitting from the revised rates on Thursday morning, while postpaid consumers will witness reduced bills by the end of February.
Media inquiries confirmed that consumers now receive more token units for the same amount purchased as of February 8, 2024, compared to January 11, 2024.
For instance, individuals purchasing tokens worth Ksh250 on Wednesday obtained 8.77 units, whereas the same amount in January only yielded 7.82 units.
The adjustment in token prices primarily stemmed from a significant decrease in the forex adjustment charge, plummeting from Ksh50.53 to Ksh28.22.
Despite this positive change, Value Added Tax (VAT) saw a slight increase from Ksh26.15 to Ksh29.07. The government imposes a 16% VAT on prepaid units, which covers various components including fuel energy costs, fixed charges, consumption, foreign adjustments, demand charges, and inflation adjustments.
Moreover, the Energy and Petroleum Regulatory Authority (EPRA) charge rose from Ksh0.62 to Ksh0.7, while the fuel energy cost increased from Ksh33.85 to Ksh36.3.
In contrast, the Water Resources Authority (WRA) charge, deducted for energy acquired from hydropower plants, decreased from Ksh0.14 to Ksh0.11.
However, the Rural Electrification Programme (REP) fee, supporting rural projects, witnessed an increase from Ksh6.48 to Ksh7.27.
Kenya Electricity Generating Company (KenGen) Chief Executive Officer Peter Njenga had previously assured Kenyans of cheaper electricity prices, citing surplus hydropower supply.
Njenga highlighted the maximum levels reached by Masinga Dam, currently at 1,056 meters above sea level, as a significant factor in stabilizing electricity costs.
"We are delighted to announce that we are experiencing robust inflows from the Mount Kenya and Aberdares catchment areas, resulting in elevated water levels in our dams," stated the CEO on Monday, February 5.