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Manufacturers urge the government to cut electricity charges by half

Manufacturers in the country have welcomed recommendations by the Presidential Taskforce on review of power purchase agreements, to reduce electricity charges for consumers and enterprises.

The manufacturers call for further reduction of electricity tarrifs beyond the recommended 33 percent to atleast half of the cost.Kenya Association of Manufacturers say that the high electricity charges has made the sector to deteriorate "In this spirit, it is imperative that there is new focus on reviewing the taxes, levies, and charges on power bills for manufacturers to reduce the overall cost of power,” said KAM Chairman, Muchai Kunyiha, he further said that if he had to compare Kenya with other African countries then they have been paying more than four times for electricity a factor that has increased the cost of production in Kenya.

"Presently, the tariff for industrial consumers stands at US cts 18/kWh, compared to Ethiopia at US cts 4/kWh, Egypt US cts 6/kWh, Uganda US cts 12/kWh, Tanzania cts 7/kWh and South Africa US cts 9/kWh,” Mr Kunyiha

The President has considered the Report of the Taskforce and notes that the key findings were: the vast differential between KenGen and IPP tariffs and electricity dispatch allocations, the lack of proper demand forecasting and planning, leading to irreconcilable projections as against demand, the existing risk allocation imbalances between KPLC and IPPs further exacerbated by poor contract management frameworks and an uncoordinated institutional architecture that inadvertently contributes to enhanced operational costs passed on to consumers,” the president.

The sector says that the only way the country can gain its energy is by reducing the current electricity charges by half.

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