Understanding The Prepaid Electricity Meter System

When they were introduced, it was expected that the prepaid electricity meters from KPLC would be a relief given the many problems associated with postpaid meters.

The postpaid system had been blamed for not returning accounts deposits, consumers having no control over their consumption, unpleasant disconnection, high reconnection fees, corruption during disconnection and reconnection of power and the estimated bills, which would be hilarious for their gross miscalculations were it not for the fact that one had to pay.

The prepaid meters were believed that would save electricity and be more convenient for consumers.

With the pilot phase already underway, the expectations associated with the prepaid meters have not come true for all customers.

There have been cases of faulty meters, limited places to purchase tokes, delays in topping up through MPESA and Airtel Money, long digits or codes, the frequent system failures that make it impossible to purchase tokens and the varying rates of units for the same amount.

My main area of focus today is on the varying rates of units for the same amount. After studying the system, this is what I discovered.

  • Firstly, the billing method for the prepaid and postpaid system is more or less the same
  • Secondly, the higher the amount of money you use to purchase the units, the more expensive a unit will cost. Kenya power charges KSh 2.00 per unit for up to 50Units bought, Ksh 8.10 per unit for 51 to 1.500 units purchased and then Ksh 18.57 per unit bought above 1,500 units.

What this means is:

During your first purchase of Ksh 500 you could get 33.3 Units, of which each will cost KSh 2.00

On your second purchase of Ksh 1000 you could get 63.7 Units, and this will bring the total of that month’s consumption to

63.7 + 33.3 = 97 Units 

Considering the fact that the first 50 Units are charged at Ksh 2.00 each, then on this second purchase of 63.7 Units, the first 16.7 Units will each cost Ksh 2.00 and the remaining 47 Units will each cost Ksh 8.16, bringing the total consumption charge to:

(16.7 x 2) + (47 x 8.10) =  Ksh 414.10 

Leaving a balance of KSh 585.9 

  • The above balance will then cater for the third party charges. These include:
  1. The Fuel Cost Charge
  2. Forex Adj
  3. Inflation Adj
  4.  Energy Regulatory Commission (ERC) Levy
  5. Rural Electrification Project (REP) Levy
  6. VAT

Unlike in the postpaid system where you incur the above charges once a month, you will incur these charges each time you purchase your tokens when under the prepaid system.

It is important to point that the Fuel cost rate, Forex adjustment rate, Inflation adjustment rate change on a daily basis, so when they are high you will get less tokens from your purchase as compared to when the rates are lower.

  • The company also charges KSh 120.00 which can be change without prior notice. This fixed cost is taxed a VAT of 12% but you only pay for it once a month.
  • When you consume more than 201 Units in a month then you will again incur an additional VAT of 12% on the cost of the additional units.

So in summary, the third party charges, VAT, fixed charge and cost per unit significantly affects the number of Units you get per a token purchase. Fluctuation in the third party charges can lower or increase the number of tokens you get.


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