Fuel cost charge and forex adjustment are the second and third biggest components respectively in power bills after consumption charge.
Electricity prices have fallen this month, offering relief to households and businesses ahead of the festivities where demand for power is set to rise.
A domestic consumer using 30 to 100 kilowatt-hours (kWh) is now getting 12.6 units for Sh500 compared to 12.2 units received for a similar amount last month while Sh200 is fetching 10.1 units compared to 9.8 units last month.
Key components used in determining power prices including the fuel cost charge (FCC) and forex adjustment rates have fallen this month according to the figures gazetted by the energy regulator, paving the way for a fall in power prices.
FCC and the forex adjustment rates have fallen to the lowest this year, mirroring unchanged fuel prices and signaling the low supply of thermal power into the national grid.
The Energy and Petroleum Regulatory Authority (Epra) has set an FCC rate of Sh3.42 this month while the forex adjustment fee is Sh0.68. This is down from an FCC charge of Sh3.81 and forex fee of Sh0.95 in November.
Increase in consumption
FCC and forex adjustment are the second and third biggest components respectively in power bills after consumption charge.
Reduced costs of electricity are a major boost for households given the anticipated increase in consumption during the Christmas and New Year festivities.
The fall is also expected to ease operational costs on business, offering them a relief given that electricity bills are some of their major headaches.
Electricity prices had marginally increased in October this year amid a rise in FCC and forex adjustment charges.
Kenya Power collects FCC from consumers to pay thermal power plants that use diesel and heavy fuel to produce electricity while the forex adjustment charge is meant to service foreign currency loans that were used to fund construction of the power plants.
The other components used to calculate power bills are a 16 per cent Value Added Tax, inflation adjustment charge which is reviewed every six months, the rural electrification levy, water resources levy, energy regulatory levy and another fee for the energy sector.
