Kenya Association of Manufacturers has expressed concern over the proposal by Kenya Power to increase electricity tariffs from April 1.
In a statement on Wednesday, they vowed to engage the Energy and Petroleum Regulatory Authority (EPRA) on the way forward and advocate for a reduction in the cost of power.
KAM Chairman Rajan Shah has instead called on the government to lower the cost of power to below Sh12.51 per unit.
He said it will make power stable and readily available to industrial users to promote competitiveness in manufacturing locally and regionally.
He added that the burden of inefficiencies in transmission and distribution should not be borne by customers.
“Manufacturers have over time raised concerns over the high cost of electricity in the country. That impacts the overall cost of production,” he said.
According to Shah, the increment shall see manufacturers’ cost of electricity increase by between Sh3.5 and Sh5 per unit, translating to a 38 per cent cost increase, depending on their respective tariff and consumption levels.
He further noted the increase will roll back the gains made when the cost of power was reduced by 15 per cent in 2021.
“Kenya’s competitive positioning on the strength of electricity is being eroded yearly despite investments in renewable energy resources,” he said.
“It is impossible for the country to be competitive as an investment destination and therefore industrialise in the absence of affordable, reliable, quality, and sustainable electricity for the manufacturing industry."
Shah said the tariff review that pushes up the cost of electricity will drive production costs even higher for local industries, rendering the manufacturing sector uncompetitive.
