Enhancing Participation of Consumers in Regulation Reforms in Electricity in

Kenya

Agnes Wachie21st April 2013

Nairobi Safari Club Hotel

The Energy Regulatory Commission

Energy Regulatory Commission(ERC) is established under the Energy Act, 2006. Following the operationalization of the Energy Act, 2006, with effect from July 7 2007, the Electricity Regulatory Board (ERB) became Energy Regulatory Commission (ERC).

The Mandate

Energy Regulatory Commission (ERC) is mandated by the Energy Act, 2006 to carry out the following functions:- Regulate the electrical energy, petroleum and related products, renewable energy and other forms of energy;Protect the interests of consumer, investor and other stakeholder interests;Maintain a list of accredited energy auditors as may be prescribed;

The Mandate Monitor, ensure implementation of, and the

observance of the principles of fair competition in the energy sector, in coordination with other statutory authorities;

Provide such information and statistics to the Minister as he may from time to time require; and

Collect and maintain energy data; Prepare indicative national energy plan; Perform any other function that is incidental or

consequential to its functions under the Energy Act or any other written law.

One of the functions of ERC is to Protect the interests of consumer, investor and other stakeholder interests. ERC protects consumers in the following ways:Tariff SettingOne of the guiding principals in tariff setting is that the tariffs must be just and reasonable. ERC sets tariffs as a way of protecting consumers.

Electricity Consumer Protection in Kenya

Resolution of ComplaintsIt is a requirement by law that any person carrying out any undertaking under the Energy Act must establish Procedures to be approved by the Commission for handling complaints related to the undertaking.ERC assists in the resolution of complaints arising from power bills, new connections, wayleaves infringement, among others. The Energy (Complaints and Disputes Resolution) Regulations, 2012 are posted to our website www.erc.go.ke.ERC assists in the resolution of complaints filed by parties to protect consumers and operators.

Electricity Consumer Protection in Kenya

ERC is involved in developing of Regulations for various functions as mandated by the Energy Act. Among the Regulations developed are;

Energy (Complaints and Dispute Resolution) Regulations, 2012,

Energy (Electricity Licensing) Regulations, 2012 Energy(Electrical Installation Work)Rules 2011 In all these regulations, stakeholders have been invited to

participate. Invitation is normally through the print or electronic media. The same are also published in the Kenya Gazette.

Consumer Participation in the Regulatory Process

Consumer Participation in the Regulatory Process

During publication and advertisement in the local media, a 40 days window is allowed for response from the public. The views are collected, analyzed before a final draft is developed and posted to the website for final presentation.

Section 6 (i) gives ERC the powers to set, review and adjust electric power tariffs and tariff structures, and investigate tariff charges, whether or not a specific application has been made for a tariff adjustment;

Section 45 outlines how the tariffs shall be set i.e (1) The tariff structure and terms for the supply of

electrical energy shall be in accordance with principles prescribed by the Commission.

The Principles are set out in the Retail Electricity Review Policy of 2005

Brief on Electricity Tariff Setting

(2) All tariffs charged for electrical energy supplied shall be just and reasonable.

(3) Any application for the review of tariffs shall be filed with the Commission for approval not later than forty-five days before the proposed effective date:

Provided that the Commission may, at its discretion, suspend a schedule of tariffs increase for up to five months.

(4) An application under subsection (3) shall be in the form prescribed by the Commission.

Brief on Electricity Tariff Setting

(5) A licensee may require a consumer to make such account deposit, commensurate with the consumer’s estimated electrical energy consumption, before electrical energy is supplied to him, which deposit may, from time to time, be revised by the licensee in order to take account of both the level of consumption and of any changes in electrical energy tariffs.

Brief on Electricity Tariff Setting

(6) The charges for electrical energy to be supplied may, subject to agreement between the parties, be paid in advance.

Brief on Electricity Tariff Setting

Consumers would always want to pay minimal charges

Political interference Fuel Cost s which are determined by international Markets Operators asking for exorbitant increment

Challenges Experienced by ERC

Thank You!