Energy Committee Engages Stakeholders on High Cost of Electricity in the Country
Members of Energy Committee have today engaged different stakeholders with an aim of reviewing the Power Purchase Agreements in order to give Kenyans a reprieve on the high cost of electricity.
The representatives were drawn from Orpower 4 Inc, Kipeto Energy Limited, Kenya Association of Manufacturers (KAM), Kenya Private Sector Alliance (KEPSA) and Institute of Engineers of Kenya (IEK).
The Committee tasked the stakeholders to highlight the terms of the existing contractual engagement between KPLC and IPPs, the details of registered owners, shareholders & directors and the variance between the rates charged by IPPs and KENGEN including details of unit charge.
During their submissions, the stakeholders proposed measures that can help lower the cost of power in Kenya. They pointed out the need to have a 24 hour economy, need to strengthen the grid & eliminate power transmission bottlenecks, explore ways to reduce cost of fuel for thermal plants, a re-look on taxes and levies on electricity Bill, need to address operational efficiency across generation, transmission and distribution lines, extension of Power Purchase Agreements among others.
The IPPS hinted to the Committee that they are willing to lower their charges should the government consider giving incentives to IPPs or concessional loans and also explore ways of the GOK taking over existing IPP debts as they said that they are currently servicing Foreign loans and experiencing a delay in payments by KPLC.
On the other hand, Rabai Power Ltd, Tsavo Power Company and Lake Turkana Windpower were turned away by the Energy Committee for failure to disclose the Directorship and shareholding of the companies as requested. These IPPs had instead tabled a web of companies to the Committee.
“Rabai Power Ltd. and Tsavo Power didn’t give full disclosure of the their CR12 in today’s meeting and even during the last meeting with the Committee. The reason as to why we are looking for the owners is because the terms of contractual engagement entered into are killing the country’s economy,” said Hon. Lemanken Aramat, the Vice Chairperson of Energy Committee.
Members of the Energy Committee noted that the biggest challenge on the high cost of electricity is the service charge which is apparently being charged by most IPPs in the sector.
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