Senate team goes after Kenya Power, energy sector cartels

Senator Wamatinga

Nyeri Senator Wahome Wamatinga during a press conference at Gatung'ang'a village in Nyeri county on December 9, 2022. Mr Wamatinga says Parliament is to start probing energy cartels.

Photo credit: Joseph Kanyi I Nation Media Group

Parliament will begin looking into all contracts signed between Kenya Power and Independent Power Producers (IPPs) as it seeks to weed out cartels in the energy sector and cushion Kenyans from escalating cost of electricity.

Senate Committee on Energy chairman Wahome Wamatinga says the inquiry will begin on February 16 in a bid to crack down on dubious contracts. 

“It will not be business as usual. Some government officials have committed Kenyan taxpayers to exorbitant, unreasonable and unreliable power supply deals. All the contracts that were illegally signed with IPPs will be revoked,” Mr Wamatinga told the Nation in Nyeri town.

He said the committee made the resolution during an induction session of House committees in Mombasa recently. 

The Nyeri Senator said cartels have over the years dominated the power sector and dictated the increasing prices of electricity.

“I am going to fight against the high cost of energy even if that will cost my last drop of blood. I will not relent in ensuring that cartels behind high electricity prices are exposed and charged in court,” Mr Wamatinga said. 

This comes after Marsabit Senator Mohammed Chute moved a motion in the House calling for a probe on contracts that are "oppressing citizens with exorbitant power bills". 

Mr Chute had previously argued that IPPs supply Kenya Power with 28 percent of its energy but account for 47 percent of power purchase costs. He then proposed that the Energy committee, led by Mr Wamatinga, institutes an inquiry into contracts signed between the utility firm and IPPs with a focus on the cost implications to the taxpayer and duration of the deals.

The senator also proposed that the committee probe the discrepancy between the cost of electricity sold to Kenya Power by KenGen, imports from Ethiopia and IPPs. 

Higher power costs

Electricity prices will from April increase by up to 78 percent if the energy sector regulator approves new tariffs proposed by Kenya Power that seek to withdraw the monthly subsidy that cushions poor households.

The NSE-listed utility firm said it is engaging the Energy and Petroleum Regulatory Authority (EPRA) for the first upward review of power prices since 2018, putting further pressure on consumers.

Besides increasing the base tariff, Kenya Power has reduced the threshold for accessing the monthly power subsidy equivalent to a 24.1 percent discount from 100-kilowatt hours to the proposed 30 units.

Kenya Power wants to increase the cost of a unit of power for the usage of less than 30 kilowatts per month to Sh28.01 a unit, up from the current Sh20.70, reflecting a growth of 35.3 percent.