Kenyans set for high December electricity bills
Kenyans are set for higher electricity bills at the end of the Christmas festivities courtesy of weakened shilling.
According to the just published schedule of tariffs for the month of December by the Energy and Petroleum Regulatory Authority (EPRA), all meter readings in December with be liable to a foreign exchange (FX) adjustment of 69.77 cents per unit from 55 cents last month.
This will be the second highest FX adjustment on electricity bills in the 2020 calendar year after October when the adjustment stood at a Ksh.1.07 high per unit of power consumption.
The foreign exchange fluctuation adjustment (FERFA) effected on a monthly basis by the energy sector regulator is related to transitional costs arising from power purchases made in foreign currency.
The ongoing depreciation of the local unit has instilled pain on Kenyans as the pricing of import depended goods and services pick up.
In contrast, the shilling had opened the year on a strong note prior to the advent of the COVID-19 pandemic with the resilience carrying gains for Kenyans in terms of costs.
For instance, across February and March, the FERFA costs had fallen into negative territory meaning electricity users received refunds from a strengthened shilling.
In the year to date, the Kenya shilling has shed an average 10 per cent of its value against the US dollar with the registered hit being greater on other leading world currencies such as the Euro and British Pound.
The weakening of the local unit has been largely attributed to unmatched dollar demand as foreign currency inflows shrink against a resumption in imports demand following the easing of COVID-19 restrictions.
A further weakening is expected to extend the pain on Kenyans as costs of goods such as fuel and motor vehicle imports pick up.
The local unit was quoted at Ksh.111.54 in early Friday trading as it trends towards a new 112 historical low marker having surpassed the Ksh.110 confidence marker in the past one month.