This archive report was first published on 24 August 2020.
Published on August 24, 2020, Kenya Power is facing a significant challenge in recovering outstanding bills from customers who have been disconnected from the grid.
The company is seeking the services of debt collectors to help recover Sh5 billion in outstanding bills, which is a fraction of the total Sh20 billion in unpaid bills.
According to internal documents seen by the Business Daily, the debt is owed by customers who cancelled their accounts on request and those whose accounts were terminated for defaulting.
Kenya Power requires debt collection services for an outstanding finalised debt of Sh5.2 billion, as stated in a tender notice.
The debt is distributed across various regions, with customers in Nairobi owing Sh2 billion, those at the Coast Region owing Sh845.7 million, and North Eastern Kenya customers owing Sh620.8 million.
Customers in Western Kenya owe Kenya Power Sh386.9 million, while those in South Nyanza are being pursued for Sh343.07 million.
Most of the debt dates back to earlier years, up to December, according to Kenya Power.
The company has about 7.4 million customers, with new users coming from rural Kenya where revenues are low due to muted demand.
More than half a million customers had failed to pay electricity bills in the three months to June, pushing new defaults by Sh3.9 billion.
Kenya Power is seeking to lower the debt to boost sales and recovery from a profit slump.
The company has issued its third profit warning in a row, citing reduced electricity consumption due to coronavirus control measures and rising costs of buying wholesale power from firms like KenGen.
