@BusinessDaily

New inflation charge to increase water bills every July

3 months ago, 16 Apr 06:09

By: Lynet Igadwah

Water tariffs will be increased annually every July if a fresh pricing formula by the regulator that incorporates inflation is adopted. The Water Services Regulatory Board (Wasreb) published the proposed formula in the latest Kenya Gazette that will see the utility cost rise every year in line with annual inflation — which last year stood at 8.01 per cent. Wasreb chief executive Robert Gakubia said Friday the annual review that is tied to inflation is meant to guard against the steep water price increases occasioned by the prolonged review of tariffs. Water prices on average are reviewed after about five years, a period that has seen most firms double the costs, sparking consumer uproar. “The proposed formula is intended to avert steep tariff increases at subsequent tariff reviews thereby shielding consumers from steep price increases every other tariff period,” Mr Gakubia said in the Friday Kenya Gazette. Wasreb is proposing to review the water tariffs on the 15th day of July every year, to remain in force until the 14th day of July the following year. It will rely on the annual inflation from the Kenya National Bureau of Statistics (KNBS) – which averaged 8.01 per cent last year, 6.3 per cent (2016), 6.57 per cent (2015) and 6.88 per cent (2014). “The annual review will do away with the current regime which has seen water prices double after reviews done after about five years,” said Mr Gakubia. MORE: Consumers stare at higher bills as hydro water drops 100pc rise In 2014, Nairobi Water and Sewerage Company (NWSCO) increased consumer water tariffs by up to 100 per cent.  The utility firm, which last increased consumer tariffs in July 2009, justified the jump on the rising cost of items like electricity, water treatment chemicals, pipes, fuels, lubricants, sewers and fittings. The new formula will see water billing modelled on that applied in the electricity market where the Energy Regulatory Commission (ERC) adjust power prices every six months in line with the US inflation rate. Currently, electricity users are charged Sh0.42 cents monthly for every kilowatt hours (kWh) and covers the period between January and June. Mr Gakubia reckons the annual tariff review will boost the cash flow of the utility companies, offering them resources to boost investments in a country where a large share of the population lacks piped water. World Health Organisation says that less than 35 per cent of Kenyans have access to piped water. Still, more than a third of the water supplied by the firms are not billed due to ageing pipes and illegal connections. The regulator is also mulling introducing a levy in water bills for development of sewerage networks, backed by the Water Act, which became law in 2016. Sewer development The levy will be ring-fenced for development of sewers. Currently, water bills contain a sewer charge, but the fee has often been diverted to other uses like improving and maintaining the water connection infrastructure and meeting operation costs, leaving little for sewer development and upgrades.
Read More


Category: business economy news markets opinion corporate lifestyle

Suggested

14 hours ago, 18:09
@BusinessDaily - By: Sam Kiplagat
Keter picks new Kenya Power boss after Tarus is charged

Energy secretary Charles Keter on Monday picked Jared Omondi Othieno to act as Kenya Power managing director following the arrest and arraignment of Ken Tarus. ...

Category: business news markets lifestyle opinion economy
Now
@BusinessDaily - By: Brian Ngugi
Shortage, costly sugar to persist as Kenya gets Comesa reprieve

Slow pace of privatisation, ailing sector shine spotlight on the stalled reforms ...

Category: business news
8 hours ago, 00:00
@StandardMedia - By: Macharia Kamau
63 companies seek Sh95m dues from Kenya Power

Companies at the centre of the procurement scandal at Kenya Power want the firm compelled to settle money owed to them for work done. ...

Category: business news
8 hours ago, 00:03
@StandardMedia - By: Geoffrey Mosoku
Energy CS Keter criticizes state crackdown at Kenya Power

Energy CS Charles Keter criticises police for conducting searches and arrests in the middle of the night. ...

Category: business news
9 hours ago, 23:12
@TheStar - By: Elizabeth Kivuva
Insurance bill seeks to protect farmers from drought losses

More farmers are expected to take up insurance following a bill which seeks to increase produce and provide a safety net. The Insurance (Amendment) Bill, 2018 was submitted by National Assembly Financ ...

Category: topnews news business
15 hours ago, 17:36
@BusinessDaily - By: Timothy Odinga
Chinese goods push Kenya’s May import bill to a record high

China was the largest exporter to Kenya in May, shipping in goods valued at Sh48 billion or 29 per cent of the total imports. ...

Category: business news corporate lifestyle economy

@BusinessDaily

New inflation charge to increase water bills every July

3 months ago, 16 Apr 06:09

By: Lynet Igadwah
Water tariffs will be increased annually every July if a fresh pricing formula by the regulator that incorporates inflation is adopted. The Water Services Regulatory Board (Wasreb) published the proposed formula in the latest Kenya Gazette that will see the utility cost rise every year in line with annual inflation — which last year stood at 8.01 per cent. Wasreb chief executive Robert Gakubia said Friday the annual review that is tied to inflation is meant to guard against the steep water price increases occasioned by the prolonged review of tariffs. Water prices on average are reviewed after about five years, a period that has seen most firms double the costs, sparking consumer uproar. “The proposed formula is intended to avert steep tariff increases at subsequent tariff reviews thereby shielding consumers from steep price increases every other tariff period,” Mr Gakubia said in the Friday Kenya Gazette. Wasreb is proposing to review the water tariffs on the 15th day of July every year, to remain in force until the 14th day of July the following year. It will rely on the annual inflation from the Kenya National Bureau of Statistics (KNBS) – which averaged 8.01 per cent last year, 6.3 per cent (2016), 6.57 per cent (2015) and 6.88 per cent (2014). “The annual review will do away with the current regime which has seen water prices double after reviews done after about five years,” said Mr Gakubia. MORE: Consumers stare at higher bills as hydro water drops 100pc rise In 2014, Nairobi Water and Sewerage Company (NWSCO) increased consumer water tariffs by up to 100 per cent.  The utility firm, which last increased consumer tariffs in July 2009, justified the jump on the rising cost of items like electricity, water treatment chemicals, pipes, fuels, lubricants, sewers and fittings. The new formula will see water billing modelled on that applied in the electricity market where the Energy Regulatory Commission (ERC) adjust power prices every six months in line with the US inflation rate. Currently, electricity users are charged Sh0.42 cents monthly for every kilowatt hours (kWh) and covers the period between January and June. Mr Gakubia reckons the annual tariff review will boost the cash flow of the utility companies, offering them resources to boost investments in a country where a large share of the population lacks piped water. World Health Organisation says that less than 35 per cent of Kenyans have access to piped water. Still, more than a third of the water supplied by the firms are not billed due to ageing pipes and illegal connections. The regulator is also mulling introducing a levy in water bills for development of sewerage networks, backed by the Water Act, which became law in 2016. Sewer development The levy will be ring-fenced for development of sewers. Currently, water bills contain a sewer charge, but the fee has often been diverted to other uses like improving and maintaining the water connection infrastructure and meeting operation costs, leaving little for sewer development and upgrades.
Read More

Category: business economy news markets opinion corporate lifestyle

Suggested

14 hours ago, 18:09
@BusinessDaily - By: Sam Kiplagat
Keter picks new Kenya Power boss after Tarus is charged

Energy secretary Charles Keter on Monday picked Jared Omondi Othieno to act as Kenya Power managing director following the arrest and arraignment of Ken Tarus. ...

Category: business news markets lifestyle opinion economy
Now
@BusinessDaily - By: Brian Ngugi
Shortage, costly sugar to persist as Kenya gets Comesa reprieve

Slow pace of privatisation, ailing sector shine spotlight on the stalled reforms ...

Category: business news
8 hours ago, 00:00
@StandardMedia - By: Macharia Kamau
63 companies seek Sh95m dues from Kenya Power

Companies at the centre of the procurement scandal at Kenya Power want the firm compelled to settle money owed to them for work done. ...

Category: business news
8 hours ago, 00:03
@StandardMedia - By: Geoffrey Mosoku
Energy CS Keter criticizes state crackdown at Kenya Power

Energy CS Charles Keter criticises police for conducting searches and arrests in the middle of the night. ...

Category: business news
9 hours ago, 23:12
@TheStar - By: Elizabeth Kivuva
Insurance bill seeks to protect farmers from drought losses

More farmers are expected to take up insurance following a bill which seeks to increase produce and provide a safety net. The Insurance (Amendment) Bill, 2018 was submitted by National Assembly Financ ...

Category: topnews news business
15 hours ago, 17:36
@BusinessDaily - By: Timothy Odinga
Chinese goods push Kenya’s May import bill to a record high

China was the largest exporter to Kenya in May, shipping in goods valued at Sh48 billion or 29 per cent of the total imports. ...

Category: business news corporate lifestyle economy
Our App