Higher power bills loom as fuel cost charge jumps
What you need to know:
- The charge is an increase from the Sh2.58 recorded last month as the levy rose for the second month in a row.
- The price of diesel rose by Sh4.57 per litre in the latest monthly review, the highest increment since July 2020.
Households and businesses face steeper electricity bills after fuel cost charge (FCC) hit a 14-month high in a shaky economic environment of low earnings due to Covid-19.
The Energy and Petroleum Regulatory Authority (Epra) in its latest data released on Friday shows that FCC for February is Sh2.61 per kilowatt hour.
The charge is an increase from the Sh2.58 recorded last month as the levy rose for the second month in a row.
The jump sets the stage for an increase in the cost of electricity for households and businesses that are still grappling with the economic meltdown of the Covid-19 scourge.
“Notice is given that all prices for electrical energy specified in Part II of the said schedule will be liable to a fuel energy cost charge of plus 261 Kenya cents per kWh for all meter readings to be taken in February, 2021,” Epra said last Friday.
FCC has been on a gradual rise on the back of a sustained rebound in global oil prices that increased the cost of diesel used for generating electricity and also powering agriculture.
Economic downturn
Global oil prices last Monday rose to their highest in just over a year, with Brent futures jumping past $60 (Sh6,566.40) a barrel, a market report by Reuters showed.
In Kenya, the price of diesel and kerosene jumped substantially last month on rising costs in the international crude market – turning the heat on poor households and transporters already hit by the economic downturn due to the coronavirus pandemic.
The price of diesel rose by Sh4.57 per litre in the latest monthly review, the highest increment since July 2020. Kenya’s economy relies largely on diesel for power generation and transport and global increments in the cost of the product directly hits households and businesses.
The rise will increase the pain of power bills on homes and businesses that are already grappling with reduced incomes, job losses and depressed sales in the wake of the Covid-19 pandemic.
FCC had stagnated at Sh2.56 per kilowatt an hour for three months to December last year amid a sluggish demand for oil globally, as economies slowly eased the restrictions imposed to curb the spread of coronavirus.
