Fuel prices are set to increase in October as the Energy and Petroleum Authority (EPRA) reviews Kenya Pipeline Company (KPC) storage and pipeline tariffs.
This follows an application by KPC to review the tariffs to boost the Company’s revenue base and help upgrade the infrastructure to enhance efficiency.
The proposal which seeks to increase fuel transportation costs from the current Sh. 4.6 per cubic meter per kilometer to Sh. 5.22, will have a ripple effect on pump prices across the country.
EPRA Director General (DG), Daniel Kiptoo, said the application, which is under public participation if considered, will take effect on 14th October 2022.
This, he said, would see fuel prices increase by 54 cents in Nairobi, 42 cents in Nakuru and 29 cents in Kisumu.
EPPRA, he said, was looking into the proposed projects to be undertaken by KPC to ensure that they are viable and will contribute to enhancing efficiency at the firm.
The proposal, he added, was also being subjected to public participation, to collect views from members of the public and stakeholders before a final decision is reached.
“It is a requirement in law that we subject the proposal to public participation to incorporate the views of members of the public, before the new tariffs are operationalized,” he said.
Speaking during a public participation drive in Kisumu, Kiptoo said the last review covering the years 2020-2022 lapsed in June.
Elizabeth Akinyi, a representative of KPC said the new tariff which has been unbundled to incorporate transport and storage seeks to increase the company’s revenue base to expand and modernize the infrastructure.
The funds, she said will go towards construction of a new line from Mombasa to Nairobi, to enhance efficiency in supply of the essential commodity.
The project, she said, is currently going through the necessary approvals adding that once completed it will enhance the flow rate of fuel from Mombasa to Nairobi before it is distributed to other parts of the country.
This, she added, will see KPC’s asset base grow from 85.9 billion to Sh. 104.30 billion with increased efficiency and storage capacity that will help stabilize pump prices.
However, a cross-section of participants at the meeting asked the firm to shelve the program, to cushion Kenyans from the high costs of fuel.
Vincent Amayi, a fuel merchant in Kisumu, said the high fuel prices had pushed many people out of business.
“We are not opposed to the proposal. It is a good venture. However, we want KPC to consider undertaking the projects at a later date when the fuel prices have gone down,” he said.