A Review of the Nigerian Energy Industry

Kenya Power rolls out cost-cutting measures

Kenya Power headquarters
Kenya Power headquarters

14 February 2015, Nairobi – KENYA Power plans to reduce its contractors by half and eliminate paper bills by June 30 as part of its cost cutting measures.

The electricity distributor which currently has 850 contractors said it will cut this number to 400 as part of its plans to blacklist “shoddy contractors” and tame any corrupt practices.

“We will be able to weed out jokers who are involved in cheating our customers and remain with a few whom we can trust with our network,” said Kenya Power managing director Ben Chumo yesterday.

The company has been reducing its contractors gradually since last year when the number stood at 1460. In February 2014, it blacklisted 10 contractors from Central Rift Valley for substandard work while in some cases the contracts were not renewed.

Chumo said the company which has 2.3 million customers on its postpaid network will also stop issuing printed bills a move he said will save the company an average Sh115 million monthly spent on preparing and posting paper bills.

Instead, clients will be alerted via electronic communication.

“If you insist (on a copy) you will pay us,” said Chumo.

Emulating banks which have cut printing costs of account statements by transfering the cost to the client, Chumo said Kenya Power customers seeking a print out of their bills at the offices will be charged a minimal fee.

He said the company has embarked on a programme to connect homes and businesses in informal settlements with electricity and will spend Sh14 billion in the current financial year ending June to subsidise cost of connections to these areas.

World Bank will co-fund the project by contributing Sh19,000 per client connection while Kenya Power will contribute Sh11,000. The customer will chip in with Sh1,160.

The project has so far connected 30,000 customers in the slums with electricity since it was started a month ago and targets 252,000 by the end of the year.
*Lola Okulo – The Star

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