As Kenya Power announced more cuts to the cost of electricity, a section of consumers will be pinching their shillings after the company increased security deposits.
According to a report by Nation, some postpaid customers have already received the communication through their phones.
The rates have been increased by up to Sh2, 500 and existing customers have been asked to top up the deposits as they pay their next bill.
“…your current deposit is insufficient to support your contract. Kindly pay the same together with your bill,” reads part of the communication from Kenya Power.
Postpaid consumers used to pay a Sh2,500 security deposit, which Kenya Power now claims is insufficient to cover future power bill defaults.
The increased charges will increase the cost of getting connected to electricity and when relocating to a new house.
Kenya Power has been dealing with a rising backlog of unpaid bills from retail and industrial customers and now wants to increase security deposits to mitigate the impact of defaults.
In the year to June 2021, the company was owed Sh29.66 billion, up Sh2.26 billion from the previous year’s Sh27.39 billion.
Meanwhile, many Kenyans are set to enjoy another 15% cut in the cost of electricity after the Ministry of Energy said it was negotiating with independent power producers.
In Janauary, Kenya Power announced a 15% cut after mitigating system and power losses, and promised another review of the prices.
The cost of purchasing 200 units of energy fell from Sh5,185 in December to Sh4,373 in February, thanks to a 15% reduction announced in January.
Kenya Power to unveil internet packages
In an attempt to cut losses, Kenya Power plans to connect millions of customers in rural homes with high-speed internet.
Previously, Kenya Power has been leasing fibre-optic cables attached to its transmission lines to Internet service providers.
Due to an increase in demand for internet, the electricity distributor is confident of rivalling all other internet providers.
Kenya Power believes it can gain market share by offering low-cost packages, indicating a pricing war in a telecoms sector where data is the new frontier for development.
After conducting pilot testing with a section of power users, the company will launch a package that will allow its corporate clients to buy internet and electricity as a package in the coming weeks.
“In the medium to long-term, the company is exploring the lit fibre business to increase the penetration of internet connectivity, particularly in the rural areas,” said Kenya Power in its latest annual report.
Kenya Power is at an advantage as compared to already existing Internet Service Providers (ISPs) due to its penetration across the country which saw them connect to millions of potential customers in rural areas.
In an attempt to reduce the cost of expensive infrastructure support involving the digging of trenches to lay terrestrial cables, ISPs decided to collaborate with KPLC where the former benefits from the latter’s national grid by connecting cables in already existing poles.