Ruto order on power tariffs welcome – KAM

May 10, 2013
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Kenya Association of Manufacturers (KAM) chief executive Betty Maina says the move comes as a big relief to industry which has been at the forefront in lobbying for a reduction of energy costs in an effort to improve the global competitiveness of local goods/FILE
Kenya Association of Manufacturers (KAM) chief executive Betty Maina says the move comes as a big relief to industry which has been at the forefront in lobbying for a reduction of energy costs in an effort to improve the global competitiveness of local goods/FILE
NAIROBI, Kenya, May 10 – The private sector has welcomed the decision by government to stop Kenya Power from increasing energy tariffs.

Kenya Association of Manufacturers (KAM) chief executive Betty Maina says the move comes as a big relief to industry which has been at the forefront in lobbying for a reduction of energy costs in an effort to improve the global competitiveness of local goods.

She says the national power supplier should first work on the current inefficiencies being experienced by Kenyans instead of increasing costs.

“Kenya Power has not demonstrated keenness to improve on the internal inefficiencies. For example, customer to staff ratio moved from 205 in 2010 to 199 in 2012 with administration and operational costs taking up 55 percent of their revenues,” she pointed out.

On Thursday, Deputy President William Ruto rejected proposals by Kenya Power to raise tariffs, and instead directed the utility firm to seek other means of raising revenue.

Ruto said there was no justification for the increase, adding that the manufacturers and ordinary power consumers had suffered higher tariffs when Kenya Power and its affiliates could find cheaper ways of generating and distributing electricity.

Kenya Power had in February this year sent a proposal to the Energy Regulatory Commission (ERC) to have the tariffs reviewed upwards to funds its expansion programmes especially the commissioning 1,250 Megawatt power projects by 2015.

“The power utility should first consider rolling out a massive campaign to encourage energy efficiency initiatives to ensure efficient use of available capacity as other alternative sources are explored,” Maina said.

To keep up the momentum, she said there is need for the government to enhance public- private partnerships in energy projects to avoid being overwhelmed.

She said with support from development partners too, it is possible to undertake feasible renewable electricity generation projects.

The manufacturing sector consumes 60 percent of the country’s electricity and is highly affected by unreliable power supplies and high energy costs.

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