Integrated Electricity Tarrif Model for Kenya

Abstract

Tariffs and tariff structures has been changing over a period of time all over the world. This has acted as a key factor which limits development in third world country. This project therefore seeks to detemine the best tarrif model that can be used in kenya to improve on the electricy consumption, the research explores all the factors which affect the costing of electrical energy. The tariff model is developed considering fuel prices, the economic factors such as inflation and the puchasing power of the consmers ,and the other factors asssociated with sytem costs ie capital cost and running costs above all these it seeks to elliminate the electricty energy poverty by encouraging many consumers to connect to the grid. In additon, some recent developments and significant trends in distribution and pricing of the electrical enegy such as pre-paid metering . It is expected that this will help Kenya to develop better tariff structures and more reasonable charging rates. The research uses the data provided by the KPLC to analyse the consumer puchasing trends and and uses the current tarrif sytem as a reference to see how best the power company can supply the energy to the country at a cost which is balanced and which encourages industrial development. The resaerch develops a tarrif model which is gradual in nature and one which excludes the fixed changes but the consumers are charged on a gradual basis where the price will increase with the increase of the Kwh consumed.