What you need to know:
- Kenya Power said stemming system losses will be key in driving down the cost of power, and aims to cut it by three percent by the end of June which will pull the losses down to 20.5 percent.
Kenya Power incurred Sh16 billion in system losses more than what is allowed by the Energy and Petroleum Regulatory Authority (Epra) to be passed on to electricity consumers.
The monopoly bought 11,462 gigawatt-hours (GWh) of electricity from its main supplier KenGen and other Independent Power Producers (IPPs) last year, but sold 8,773GWh, with the rest (23.46 percent) being lost along the way or stolen.
During the year, the company sold electricity at the rate of Sh16.3 per kilowatt-hour, which means the lost 2,689GWh amounts to Sh43.83. Epra's threshold for the system losses for the year was 14.9 percent, which means Sh27.84 billion was passed on to consumers, which is Sh15.99 billion more.
Epra increased Kenya Power's allowable system losses to 19.9 percent for the current financial year which ends in June.
Over half (51 percent) of the system losses stem from low efficiency lines and equipment that the firm uses to distribute electricity, while 49 percent is attributed to theft of power through illegal connections, wrong meter readings and meter bypasses.
Kenya Power said stemming system losses will be key in driving down the cost of power, and aims to cut it by three percent by the end of June which will pull the losses down to 20.5 percent.
"We cannot immediately calculate by how much the cost of electricity will reduce for our customers when we achieve our target to cut our system losses by three percent this year, but it evidently will help to reduce the cost of electricity in the long term," said Kenya Power Sales Manager Margaret Kanini.
Ms Kanini said a gradual reduction in system losses will see electricity tariffs revised downwards by Epra to ease pressure on electricity users. She said the firm is investing in laying down thicker electricity transmission lines and better equipment as it expands its network across the country.
The company has added 5.8 million households, businesses and institutions to the national power grid from 2013 which has increased the company's total transmission and distribution lines to over 327,000 kilometres during the period.