KenGen Chief Executive Albert Mugo

KenGen Chief Executive Albert Mugo

Kenya Power and the Energy Regulatory Commission (ERC) have been at loggerheads after the watchdog accused the electricity distributor of making operational decisions that have increased the cost of power to consumers in the past two months.

It is understood that ERC wrote to Kenya Power suggesting that the distribution company may have deliberately opted to take in the more expensive thermal power to the detriment of consumers despite the availability of cheaper hydro and geothermal power in the market.

The sector regulator was concerned that a heavy uptake of thermal electricity had drastically raised fuel cost levy for August power bills and asked the power firm to revert to a mix that will stop the cost surge.

It says Kenya Power had not aggressively pursued cheaper hydro-power generation despite the prevailing fairly good water levels and this is likely to go against the Government?s commitment to keep power costs down.

In its defence, Kenya Power said it had bought thermal electricity from Triumph Power?s 83-megawatt plant in Athi River, which was on a mandatory reliability test-run after becoming operational last month. The 30-day test-run ended on August 3.

Shut down

Kenya Power had also argued that it has limited options in its sourcing of electricity after several geothermal plants in Olkaria shut down last month for maintenance and others broke down, a position strongly denied by KenGen.

This it reckons forced the utility firm turn to expensive thermal generators, at a time when fuel prices had risen steadily as the shilling weakened against the US dollar.

But KenGen?s Chief Executive Albert Mugo now says that all geothermal power plants except one unit at Olkaria ? which is out for annual repairs- were operating normally.

?All our power plants at Olkaria are fully operational except one unit at Olkaria IV. The machine, which is out for routine maintenance could be restored in the next four days. Just like a vehicle, power generating turbines need normal mechanical repairs,? explained Eng Mugo.

?We are also making up for the temporary reduction in geothermal output by scaling up contribution from other hydro sources,? said KenGen. The high cost of energy is likely to push up cost of living to double digits.

This has seen the regulator increase its scrutiny on factors that are in the country?s control to keep prices low, hence the spat with Kenya Power.

National grid

It is understood this is the reason ERC wants to set up another entity to buy power in a bid to ensure the cheapest available power is what is fed to the national grid. Kenya Power is opposed to the plan to bring in a new player to buy power on its behalf.

By Paul Wafula, The Standard

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