Kenya Power seeks debt collectors to recover bills worth Sh 5 billion from customers

Kenya Power is seeking debt collectors to help recover bills of Sh 5 billion from customers who have been disconnected from the grid, according to a news report by Daily Nation.

This move is a part of the electricity distribution new strategy to net defaulters and roots out electricity thieves using illegal connections to the national grid to deprive the company of revenue as it seeks to lift itself out of a deep earnings slump.

While Kenya Power unpaid bills amount to more than Sh 20 billion, the 5 billion in debt that has accumulated over the years.

Kenya Power has said in internal documents that the debt is owed by customers who canceled their accounts on request and those whose accounts were terminated for default.

"The Kenya Power requires debt collection services for an outstanding finalized debt of Sh 5.2 billion," said Kenya Power in a tender notice.

 About Sh2 billion of the debt is owed by customers in Nairobi, while those at the Coast Region owe Sh 845.7 million.

North Eastern Kenya customers have not paid Sh 620.8 million.

Customers in Western Kenya owe Kenya power Sh 386.9 million while those in South Nyanza are being pursued Sh 343.07 million.

Most of the debt dates back from earlier years up to the month of December, said Kenya Power.

It currently has about 7.4 million customers, with the new users coming from rural Kenya where revenues are low on muted demand.

More than half a million customers, the company said, had failed to pay electricity bills in the three months to June, pushing new defaults by Sh 3.9 billion.

Kenya Power is seeking to lower the debt boost sales and recovery from profit slump.

It has issued its third profit warning in a row, citing reduced electricity consumption due to coronavirus control measures and the rising cost of buying wholesale power from firms like KenGen.

The alert means its net earnings will decline by at least 25 percent of last year’s profit of Sh262 million which was the worst in 16 years.