This archive report was first published on 17 September 2019.
The depreciation of the Kenyan shilling against the US dollar has led to a rise in foreign exchange adjustment costs, contributing to higher power bills for consumers.
As of September 2019, the foreign exchange adjustment component on the power bill had shot up to 21.36 cents per unit of power consumed, the highest level since July 2018.
The Energy and Petroleum Regulatory Authority (EPRA) reviews the forex adjustment component monthly and announced the new rate in a Kenya Gazette notice.
Additionally, the fuel cost charge, another component reviewed monthly by EPRA, decreased to Sh3.45 per unit in September compared to Sh3.60 per unit in August.
Loans advanced to power sector firms for infrastructure projects are usually in dollars, Japanese Yen, or Euros, which contributes to the foreign exchange volatility.
Consumers have enjoyed credits for most months since August 2018, but the recent rise in crude prices following an attack on Saudi Arabia's oil field has added to the energy cost.
According to Central Bank data, the shilling has been trading at lower levels, with a slight recovery from the lowest level in five years of Sh104.3 per dollar in July.
