Keter's Plea Brutally Dissected

Before someone jumps on me, kindly familiarize yourself with the concept of economies of scale (In microeconomics, economies of scale are the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output decreasing with increasing scale. Wikipedia ).

Keter had a good idea, communicated badly. The poor communication is from the fact that, 1. it was not fully explained in a way Wanjiku would understand and, 2. The timing was awful.

What Keter wanted to say - and I believe he said it based on the sound advice from energy economists - is that the country's total electricity consumption is not large enough to enable the generating units produce at a lower unit cost.
You see, The production infrastructure we have in the country have capacity to produce more than the country can absorb. But the cost of running and keeping the generating units well maintained ( well, they cannot be allowed to go to seed simply because we are not using them now) has to be recovered from the little units produced for consumption and are actually consumed. The result of this is that the overheads are spread over very few units making those units very expensive.
What this means is that if say we doubled consumption now we wouldn't have to invest in new production infrastructure but we would be able to spread (share) the cost of production over twice the number of units consumed, thereby making each individual unit consumed cheaper. What Keter probably said is that the way we use power (for lighting, light electronics, light heating such as shower and ironing only) is not enough to enable the consumption of enough units to reach the tipping point where the cost spread per unit would begin coming down.
The government had two policy thrusts to address this problem - connect more people to consume (hence the aggressive rural electrification) and promoting higher household consumption (hence Keter's statement).

In my opinion, therefore, Ogunda's commentary delves more into sentimentality rather than sound economics issues involved. But, well, like we say in communications, timing is everything and Ogunda seems to score...only he did not interrogate the reasoning behind the minister's statement.
 
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Mwalimu-G said:
Before someone jumps on me, kindly familiarize yourself with the concept of economies of scale (In microeconomics, economies of scale are the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output decreasing with increasing scale. Wikipedia ).

Keter had a good idea, communicated badly. The poor communication is from the fact that, 1. it was not fully explained in a way Wanjiku would understand and, 2. The timing was awful.

What Keter wanted to say - and I believe he said it based on the sound advice from energy economists - is that the country's total electricity consumption is not large enough to enable the generating units produce at a lower unit cost.
You see, The production infrastructure we have in the country have capacity to produce more than the country can absorb. But the cost of running and keeping the generating units well maintained ( well, they cannot be allowed to go to seed simply because we are not using them now) has to be recovered from the little units produced for consumption and are actually consumed. The result of this is that the overheads are spread over very few units making those units very expensive.
What this means is that if say we doubled consumption now we wouldn't have to invest in new production infrastructure but we would be able to spread (share) the cost of production over twice the number of units consumed, thereby making each individual unit consumed cheaper. What Keter probably said is that the way we use power (for lighting, light electronics, light heating such as shower and ironing only) is not enough to enable the consumption of enough units to reach the tipping point where the cost spread per unit would begin coming down.
The government had two policy thrusts to address this problem - connect more people to consume (hence the aggressive rural electrification) and promoting higher household consumption (hence Keter's statement).

In my opinion, therefore, Ogunda's commentary delves more into sentimentality rather than sound economics issues involved. But, well, like we say in communications, timing is everything and Ogunda seems to score...only he did not interrogate the reasoning behind the minister's statement.
Click to expand...
Nichanue please , why then are you charged a higher rate whenever you exceed 100 units per month - domestic ordinary tarriff compared to lifeline (less than 100 units a month).
It might work with other entities but not with Jubilee at the helm .
Some times back Honda fit duty almost doubled after the govt realised many people were going for it .
 
Some times back Honda fit duty almost doubled after the govt realised many people were going for it .
From 300k to 600k. Wananchi also realized how reliable they were and maintenance cost was also very low. Serikali ikaingilia kati
 
zapp_brannigan said:
Nichanue please , why then are you charged a higher rate whenever you exceed 100 units per month - domestic ordinary tarriff compared to lifeline (less than 100 units a month).
It might work with other entities but not with Jubilee at the helm .
Some times back Honda fit duty almost doubled after the govt realised many people were going for it .
Click to expand...
Your question touches on what is called a graduated tariff system under which different classes of customers are charged differently for different reasons. In our country, the system is meant to ensure social equity and give the very poor a subsidy through what is called a domestic consumer lifeline tariff.
The very poor, it is assumed, can only afford a few units mainly for lighting their two rooms and operating a radio and TV. This will mean that they will consume less than 100 units in a month. Because there is no way of telling which household is poor, it is determined that anyone buying less than the 100 units in the month pays the lower (subsidised) rate. If your consumption is higher than the subsidized 100 then you pay the higher (unsubsidized) rate for the excess units.
Kizungumkuti comes when you are buying a token worth, say, 3k for 130 units. The total units, being more than 100, will be calculated at two rates i.e the first 100 at the lower subsidized rate and the extra 30 at the higher rate. If you buy for 2k (89 units) at the beginning of the month then on 20th you buy another 2k, then 11 units will be charged lower and 78 at the higher tariff.
It becomes more complicated because other billing factors such as forex adjustment and petroleum levy fluctuate from month to month.
 
Aviator said:
You lost me here.
Why do we experience rationing then?
Click to expand...
Have we been experiencing rationing lately or it is outages due to distribution systems decay?

Edit:
2,370 MW

“Current electricity demand is 1,600MW and is projected to grow to 2,600-3600MW by 2020.” The World Bank explains that Kenya has an installed generating capacity of 2,370 MW and peak demand of about 1,770MW. KenGen, which is 70 per cent owned by the Government, has an installed capacity of 1,631MW.
www.standardmedia.co.ke

Fact-Checker: Just how much is Kenya’s electricity capacity?

Demand for electricity is growing at about eight per cent a year, according to the World Bank’s data.
www.standardmedia.co.ke www.standardmedia.co.ke
.
 
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Mwalimu-G said:
Have we been experiencing rationing lately or it is outages due to distribution systems decay?

Edit:
2,370 MW

“Current electricity demand is 1,600MW and is projected to grow to 2,600-3600MW by 2020.” The World Bank explains that Kenya has an installed generating capacity of 2,370 MW and peak demand of about 1,770MW. KenGen, which is 70 per cent owned by the Government, has an installed capacity of 1,631MW.
www.standardmedia.co.ke

Fact-Checker: Just how much is Kenya’s electricity capacity?

Demand for electricity is growing at about eight per cent a year, according to the World Bank’s data.
www.standardmedia.co.ke www.standardmedia.co.ke
.
Click to expand...
We haven't experienced lately, but I don't think we have added significant capacity since the days of rationing.
Or have we?
 
Mwalimu-G said:
Your question touches on what is called a graduated tariff system under which different classes of customers are charged differently for different reasons. In our country, the system is meant to ensure social equity and give the very poor a subsidy through what is called a domestic consumer lifeline tariff.
The very poor, it is assumed, can only afford a few units mainly for lighting their two rooms and operating a radio and TV. This will mean that they will consume less than 100 units in a month. Because there is no way of telling which household is poor, it is determined that anyone buying less than the 100 units in the month pays the lower (subsidised) rate. If your consumption is higher than the subsidized 100 then you pay the higher (unsubsidized) rate for the excess units.
Kizungumkuti comes when you are buying a token worth, say, 3k for 130 units. The total units, being more than 100, will be calculated at two rates i.e the first 100 at the lower subsidized rate and the extra 30 at the higher rate. If you buy for 2k (89 units) at the beginning of the month then on 20th you buy another 2k, then 11 units will be charged lower and 78 at the higher tariff.
It becomes more complicated because other billing factors such as forex adjustment and petroleum levy fluctuate from month to month.
Click to expand...
I appreciate your explanation but kwa ground KPLC is incompetent kuruka .Infact before end of year majaliwa I will have shifted to solarlighting and other low wattage consumption devices . KPLC nitawaachia instant water heater , oven and fridge . 3 years later nimejaribu kutumia all avenues to have KPLC fix low voltage in our area but they do nothing .
Wharr is this
Screenshot_20200629-141056~2.png

Screenshot_20200629-140848~2.png

148 volts
Screenshot_20200629-140943~2.png
 
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