A plan to allow certain of Kenya Power’s customers to pay their electricity bills in foreign currencies was unveiled.
The electricity utility company stated in its 2022 financial notice, which was released on February 28th, that the action was directed at Kenyans who were employed and generating income in dollars and euros.
The business said that the performance of the Kenyan shilling relative to the US dollar and other currencies was the reason behind the new method of charging a small group of clients.
“To lessen the effects of foreign exchange rate fluctuations, which have continued to negatively impact financial performance. We are considering a number of initiatives, one of which is letting some of our customers pay their electricity bills in foreign currencies if they receive their income in those currencies.
The notification stated, in part, that “We are optimistic that our continuing emphasis on the key areas as indicated will enable us to achieve our objectives and create value for our shareholders.”
The Kenyan shilling has declined recently versus the US dollar, claims the Central Bank of Kenya (CBK). It has, however, stabilized in recent weeks.
As of Tuesday, February 28, the CBK’s exchange rate for the shilling versus the dollar was Ksh126, while the rate for the euro was Ksh133.
Nevertheless, the electric company did not specify when the new payment method would start or whether a structure for it was available.
The electric company indicated that given its Ksh1 billion loss from July to December 2022, these were some of the steps that would improve its financial performance.
“Finance costs increased to Ksh7.3 million from Ksh6.7 million due to an increase in unrealized foreign exchange loss resulting from the revaluation of loans denominated in foreign currencies as a result of the shilling’s devaluation against major currencies.
According to Kenya Power, by maintaining an unshakable focus on boosting energy sales, improving system efficiency, and resource-wise management, the company expects to improve its business performance in the second half of the fiscal year.
Due to the dominance of the dollar relative to the shilling, Kenya Power may join a number of real estate developers that are adopting the payment of rent in dollars if the move is successful.
