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Electric Power Company: Monopoly in need of competition

Updated on May 26, 2012
An electric power transformer: the type that unscrupulous people are stealing and increasing the cost of power to consumers
An electric power transformer: the type that unscrupulous people are stealing and increasing the cost of power to consumers | Source


Power outages in April 2012

The month of April was a particularly wet and trying month for homes and businesses in Kenya. Each day of a very heavy downpour was followed by power failure in most areas covered by the rain. I personally counted five days when the power outage lasted more than five hours. In at least one very serious power failure, the whole country had no electricity for a period of six hours. One government hospital in the Coast Province lost a patient in the High Dependency Unit because the hospital’s emergency power generators were either non-existent or non functional. Besides the many hours of production lost in industries, homes with refrigerators must have lost tons of food running into millions of Shillings. But the Kenya Power and Lighting Company Limited is unapologetic. It blames vandals of its transformers, transformer oil and cables on the frequent power failures. While the KP & LC is the only agency that can prove that that is indeed true, the consumers of electricity can be certain of one thing – if the bill does not remain constant, despite the outages, it will increase.

Updated 25th May 2012


Monopoly Electric Companies

In many countries, the electric companies have no competition. This has led them to treat their customers with disdain and sometimes their action border on punishing the consumer for reasons only known to themselves.

Queer billing

Sometimes the billing does not reflect consumption. In my case, the power company gave out free energy saving bulbs in a bid to encourage their use. I changed all my bulbs to the fluorescent types as recommended. What was the result? No change in my average consumption. Later I operated a chicken incubator with a one hundred watt (100 w) bulb, 24 hours a day for 21 days. You guessed right that my power consumption did not increase. In fact, what you may not have guessed is that it went down by a few hundred shillings. The lesson learned was that there is no need to conserve power because I will save nothing.

I have a feeling that many such companies in the world have meters that were installed in 1960’s and 70’s and have neither been replaced since nor recalibrated. I used to blame my old refrigerator, but now I believe strongly that the old faithful fridge is innocent.

You probably have heard of a neighbor who went on holiday for a whole month, yet they were still billed their average consumption the next monthly! This happens so often in my part of the world that talk shows have discussed.


Disconnections and more fees

The power company has a date by which you should have paid your bill, failure to which you risk a disconnection. It does not matter that you may have gone out of town. Once a disconnection has been effected, you will be charged a reconnection fee above the normal bill. This is fine you say. Perhaps you think you rush and pay three days before the disconnection and escape the penalty – wrong. The penalty called ‘reconnection charge’ will still be added to your next bill. If a disconnection actually takes place, you are in deep trouble. You must pay the reconnection fee before you get the power back. In my part of the world, you may soon discover that power does not come back that fast. You may be required to pay additional deposit on your contract which will be equal to your monthly average consumption before you get the power back.

Punishing the consumer

Disconnections do not happen randomly, on any day of the week. No! They are timed to have maximum effect on the consumer. They are usually done on a Thursday or Friday. Let’s say it happens on a Thursday. You will rush to pay the outstanding amount before visiting the reconnections counter. You will be told that all the technicians were already out in the field so it will have to be tomorrow, Friday. You can rest assured that you will not have power back before Monday.

Power disconnections are timed to happen before major public holidays like Easter and other long weekends. Of course if you are willing to pay a ‘tip’ to someone you will be assured of power restoration faster.

If like me you are faced by such a monopoly, you have only three options

1. Invest in a power generator. Petrol or diesel powered machines will come handy if you can figure how to control the noise.

2. Invest in Solar power. If you are in your own house, there is no reason why you should be held captive by monopolies. If you are planning to build a house soon, factor in the Solar power in the building costs and go green . If you are adequately self-sufficient, you can tell the power company to uproot their equipment and migrate where they’ll be most needed.

In the meantime, if you are like me, just pay your bill on time and make as much use of the power as you can- even run a factory.

Reasons for power failures

One of the reasons that KP & LC gives for increasing charges on power consumption is that they use ‘petroleum’ to power emergency generators! In a country that has the equator cutting across it; with 365 days of sunshine and the four winds blowing in all directions, why would a government funded Organisation use a petroleum product to power emergency generators? It would make sense if Kenya was an Oil producing country, but it isn’t – at least not yet.

KP & LC would do well to take an insurance cover (if there will be an insurer that will take the bait) so that consumers of its product can be compensated when power outages occur. Perhaps the Insurer and KP & LC will work together to ensure that covering the risk is worth it for both parties.

In the meantime, KP & LC should consider tapping into the free solar and wind power going to waste under the Kenyan sky.

The candle is the ever faithful servant
The candle is the ever faithful servant | Source


Power bills will not come down any time soon

The cost of power is not coming down anytime soon in Kenya if the Monopoly continues to lose assets at the current pace to vandals. Here is what is happening.

The Kenya Power and Lighting Company uses transformers which are supported by two poles. These can be seen along highways and in housing estate. Whenever there is a power outage, this are the first units to be investigated since, besides housing fuses, they also have switches to cut off the high voltage power in sections that need repair. The transformers are cooled by an oil that has been put to many other uses by enterprising Kenyans – when they can get the oil. Demand for this oil has fuelled theft in remote places, but recently, the transformers have stolen in broad daylight. Who would be that daring to still such huge objects of electronic engineering that must weigh at least a quarter of ton if not more? You would expect that vandals would fear the high voltage and keep off the transformers. This leads many to wonder if the monopoly does not have a hand in the plunder.

You are wondering what use one would have for a transformer. The first is the obvious metal and wire which is sold to scrap metal dealers. We should call them ‘unscrupulous’ because they know the source of the metal and wire. The other component of the transformer that is in great demand is the coolant. This oil is used for cooling other machines that require. However, according to the nation of 20th May 2012, unscrupulous businessmen are repackaging it as engine oil and brake fluid, using containers that have been branded with the logos of respected companies.

The one use for this transformer oil that really gulls is this one: As cooking oil!

After you have absorbed the shock, here’s the really big shocker. Unlike the motorist, the cooking oil is not sold to unsuspecting housewives. It is sold to unscrupulous fast food outlets who claim that it fries chips for very long since it does not oxidize easily. In other words, they save on cooking oil by using transformer oil. So who cares about the health of the consumers? Perhaps only you and I because we are not unscrupulous. Unscrupulous also means the following:

· Dishonest

· Unprincipled

· Corrupt

· Immoral

· Deceitful

According to the same press report, the Kenya Power and Lighting Company lost 196 transformers in the month of April alone, a month that experienced the highest number of power outages since the beginning of the year. In the year 2001, the company lost an average of 92 transformers per month. For an item that costs about Shs. 800,000 ($9,412).

April’s 196 transformers translate to a loss of Shs. 156.8 million ($1,844,706). You can work out the expected loss by the end of 2012. The consumer can expect to shoulder this loss, meaning that there will be no respite in power bills any time soon. The more reason why consumers should urgently look for alternative power sources – like solar energy and wind generated power.


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  • Emmanuel Kariuki profile image
    Author

    Emmanuel Kariuki 19 months ago from Nairobi, Kenya

    pramodgokhale,

    I get you, you believe is revenue is collected efficiently rates could even go down, because the few who pay diligently have to cover those who don't want to pay.

    I suppose even if the government generates cheap wind and solar power but is poor at enforcing payment of bills, power will never be cheap.

  • pramodgokhale profile image

    pramodgokhale 19 months ago from Pune( India)

    Sir,

    I already posted comment yesterday. Power tariffs are rising frequently and in India vote bank politics is a factor to appease defaulters and honest people keep paying bills.

    Solar power is an answer to power hungry third world nations power deficit but revenue collection if 100 per cent then all ills can be cured but it is in

    vain.

    pramodgokhale

  • pramodgokhale profile image

    pramodgokhale 19 months ago from Pune( India)

    Sir,

    Solar power in abundance in India and Kenya.Revenue collection and commercial viability is the hurdle and when private operators invest large amount then they want revenues promptly and nothing is wrong there.They supply power at fixed rate so pay back is long time nearly 10/20 years so they will never do charity , Why? It is the government and people to participate in power generation so it will be successful community project.

    pramodgokhale

  • Emmanuel Kariuki profile image
    Author

    Emmanuel Kariuki 19 months ago from Nairobi, Kenya

    Thanks pramodgokhale ,

    The tariffs in Kenya don't even make sense. I once stopped using Electricity to lower my bill but instead the bill more than doubled. When I went back to using electricity for heating water the bill went down. It seems the meters are just ornamental and the meter reading a futile exercise. Perhaps the billing system merely ensures that a certain target in a particular period is met.

    Why don't third world countries envest in solar power that is so abundant and free? Do you ask your self that question? If I was the president I would give a tax reduction for every Kilowatt generated by wind or solar.

  • pramodgokhale profile image

    pramodgokhale 20 months ago from Pune( India)

    Sir,

    Your articles are interesting and identical to situation in India.In India state electricity boards have monopoly for power distribution and they failed to serve and tariffs are rising frequently. There are accidents and recently new government has opened power sector to private sector to build -operate-transfer basis and it started improvisation in power supply and efficiency.

    India invited foreign investors to invest so it is necessary to generate power and with all parameters to fulfill requirements of manufactures

    Leakages and power theft is part of our power distribution and politicians overcooked offenders for vote bank politics or to appease their voters.

    Honest people pay their bills promptly but offenders are moving scot-free.It is nice to interact with you and citizens of two third world nations

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