Kenya "Powerless" - Where’re My Lemons At?

 

 

There’s disturbing news coming out of Kenya Power that they have been given the green-light by the EPRA to pass on their losses to the consumer.

These losses are said to be caused by old infrastructure, thieving employees and customers. Kenya Power will now recover 19.9 per cent of system losses from consumers up from 14.9 per cent as established in an EPRA 2018 tariff review. 

System losses is the difference between what Kenya Power buys from power producers and what it sells to consumers.

So why don’t we just do the same with KQ and other failing state corporations, let’s ask the consumers to pay for their mismanagement.

I mean, is that even a solution?

This could not have come at a worse time when businesses are struggling and many Kenyans have lost jobs due to the pandemic; especially because energy is at the core of every business process and function.

The Energy Act 2019 section 10 enumerates the functions of the Energy and Petroleum Regulatory Authority (EPRA), among which is to regulate generation, importation, exportation, transmission, distribution, supply and use of electrical energy.

The Act also provides that the EPRA under section 10 z (hh) shall protect consumer, investor and other stakeholder interests.

Furthermore, the EPRA has power under the Act in section 11 (c) to set, review and adjust electric power tariffs and tariff structures and investigate tariff charges, whether or not a specific application has been made for a tariff adjustment.

This intended transfer of liability to consumers does not in any way protect consumer interest. KPLC must be able to clearly tell the public what percentage of their losses are brought about by thieving customers. 

Furthermore, they must directly target, apprehend and deal with those thieves.  A blanket condemnation cannot suffice!  

It’s not news to anybody within the borders of this country that Kenya Power has been a cash cow for corrupt individuals for decades now.

In fact, the number of cases still pending in court as regards the plunder of the state corporation are just overwhelming!

In 2019 for instance, KPLC was ranked as the second most corrupt government agency by the EACC. 

A statement on the KPLC website narrates how one of their staff was arrested by the EACC for receiving a bribe from a customer for re-connection of electricity.

These cases have become the order of the day for KPLC not to mention the many irregular procurement tenders that have lost the corporation billions over the years.

And of course we cannot forget to mention the infamous ChickenGate scandal, that saw the stashing away of over 500 million shillings in accounts in Jersey. 

I mean, the list is endless and just draining!

But the point is this. KPLC and the ministry of energy have failed to reign in on their employees. KPLC used to be one of the best government employers but lately its name has become synonymous with plunder and corruption.

The power supplier cannot therefore allege to transfer its losses to the consumer resulting from its own inability to discipline errant employees.

In fact, I believe the major reason why KPLC is going the tariff increment way is because it's financially in the red, going by its last financial report dated 30th June 2019 in which the power supplier's profit dropped drastically to Sh.262 million down from Sh. 3.2 billion in 2018.

Secondly, as to losses to do with old infrastructure, it is plainly immoral. The big corporation has a huge team of engineers and project managers who are paid to do system evaluation and maintenance on a regular basis.

How am I as a consumer supposed to know about broken systems at KPLC? And even if I did know, what would I do about it? All I want is to see some light in my house. The details of how the turbines are not working at Olkaria are really none of my business.

In my opinion, the EPRA is stepping on a hot potato here by heading to KPLC’s application for tariff review. It needs to investigate the legitimacy of this application and soberly consider consumer interest.  

Otherwise I’ll be turning to my lemon batteries to generate my electricity! But wait a minute, there are no lemons in the market because of the pandemic!!

The challenges of KPLC are an indicator that government needs to strongly consider inviting private power producers into the sector. This will stem the lackluster attitude of the corporation and provide competition leading to better services at an affordable cost to the consumer.

Of course some quarters will argue that power supply is a national security issue that must be under the reins of government. But the fundamental questions of consumer protection, reliable power supply and power pricing are issues that we have to deal with conclusively.

There’s a historical tendency of government bailout of failed corporations that will never resolve the issues of mismanagement and corruption.

It’s the proverbial case of bleeding a leech to fatten a heifer. The consumer is already overburdened with taxes, debts and inflation.  Asking a poor man to pay for another man’s evils is utterly inhuman!

Let KPLC look to the right sources for its recovery. Let them restructure if they have to. But let them not use another government agency like the EPRA to introduce extra costs to the consumer. It’s not right.

The reasons they are giving are at the least flimsy and childish. It’s just the other day, that KPLC was embroiled in the power token scandal  in which it’s estimated consumers lost about 1 billion Kenya shillings.

Let KPLC and the ministry of energy get their act together. This act of trying to fit a square peg into a round hole just won’t work!

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