{"id":160087,"date":"2026-04-10T16:02:08","date_gmt":"2026-04-10T16:02:08","guid":{"rendered":"https:\/\/www.africa-press.net\/kenya\/all-news\/kenyas-electricity-most-expensive-in-africa-report"},"modified":"2026-04-10T17:10:33","modified_gmt":"2026-04-10T17:10:33","slug":"kenyas-electricity-most-expensive-in-africa-report","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/kenya\/all-news\/kenyas-electricity-most-expensive-in-africa-report","title":{"rendered":"Kenya’s Electricity Most Expensive in Africa Report"},"content":{"rendered":"

Africa-Press – Kenya. <\/strong> <\/span>KENYA has the most expensive power among key African economies and neighbouring countries, an industry report shows.<\/p>\n

This, the private sector says, is making the country\u2019s manufacturing sector uncompetitive compared to other exporting markets and unattractive to new major industrial investments.<\/p>\n

The Regulatory Audit Report by the Kenya Association of Manufacturers, with support from Trademark Africa and funding from the Foreign, Commonwealth and Development Office, indicates the country stands to lose both in the export markets and from cheaper imports.<\/p>\n

Kenya\u2019s average industrial power tariff is between $0.18 (Sh23.26) and $0.23 (Sh29.73) per kilowatt hour, dependng on the tariff category, with SMEs having even higher costs.<\/p>\n

\u201cSome of the African countries that would be competing with Kenyan manufacturers offer better and more favourable electricity tariffs than Kenya,\u201d the report notes.<\/p>\n

For instance, South Africa and Egypt have tariffs averaging $0.03 (Sh3.88) per KWh, Morocco and Ethiopia $0.05 (Sh6.46).<\/p>\n

Tanzania and Uganda have average tariffs of $0.08 (Sh10.34) and $0.18 (Sh23.26) per KWh, respectively.<\/p>\n

\u201cHigh production costs due to costs associated with high taxes, fees at national and county governments, where other countries have better industrial policy, such as lower production costs, reduce Kenya\u2019s competitiveness,\u201d the report notes.<\/p>\n

Kenyan products end up being more expensive on the shelves.<\/p>\n

It reduces Kenyan manufacturers’ capacity to access other African markets due to potentially high product prices resulting from the high cost of doing business in Kenya.<\/p>\n

Cheaper imports from China and other African countries, including Egypt, continue to dominate the Kenyan market.<\/p>\n

According to KAM, the manufacturing sector\u2019s contribution to the GDP in Kenya averaged 10 per cent between 2011 to 2016 and has been on a declining trend, contributing 7.6 per cent to GDP in 2024.<\/p>\n

\u201cIt is apparent that instead of industrialising, Kenya is deindustrialising,\u201d the report states, \u201cthis is premature deindustrialisation characterised by a shrinking manufacturing sector at lower levels of income than early industrialisers.\u201d<\/p>\n

Therefore, developing countries such as Kenya are failing to experience industrialisation, where an economy transitions from agriculture to manufacturing and eventually to the service industry (deindustrialisation).<\/p>\n

According to experts, it is possible to reverse deindustrialisation and low growth rates through the Bottom Economic Transformation Agenda (BETA), in which the sector is expected to increase its contribution to the GDP to 20% by 2030.<\/p>\n

However, this will need business policy and regulatory certainty.<\/p>\n

Of particular interest is the need to create a healthy manufacturing ecosystem through a sound policy, regulatory and institutional framework to foster innovation, forward and backward linkages, and dynamic economies of scale, the report advises.<\/p>\n

KAM chief executive Tobias Alando said: \u201cKenya\u2019s long-term sustainability and economic resilience will depend on its ability to build a competitive manufacturing base capable of thriving both regionally and globally.\u201d<\/p>\n

This, he said, is particularly important as the country positions itself to take advantage of opportunities under the Africa Continental Free Trade Area (AfCFTA).<\/p>\n

Reduced competitiveness of the local manufacturing sector due to high costs (financial and time), has in recent years seen key multinationals fold and relocate to other African countries that have a more favourable business climate.<\/p>\n

This, as Kenya remains an importing country rather than a manufacturing state.<\/p>\n

President William Ruto has since promised regulatory reforms, tax incentives, and a review of the country\u2019s power tariffs, in the latest move to drive Foreign Direct Investments.<\/p>\n

During the Kenya International Investment Conference (KIICO 2026) in Nairobi last month, Ruto affirmed his government\u2019s commitment in making Kenya more attractive to investments.<\/p>\n

Kenya secured 20 deals valued at $2.9 billion (Sh374.8 billion) during the conference, spanning agriculture, real estate, manufacturing, mining, Business Process Outsourcing and telecommunications, healthcare, and energy sectors.<\/p>\n

These are expected to create at least 63,240 jobs across 10 counties.<\/p>\n

World Bank however, cautioned that high operating costs, including costly electricity, high taxation and an unpredictable regulatory environment, would dampen Kenya\u2019s industrial growth ambitions.<\/p>\n

According to the World Bank, Kenya has one of the highest energy costs in the region and compared to other competing key markets.<\/p>\n

This, in addition to other operating costs and regular policy changes are making it uncompetitive.<\/p>\n

While the country has adopted good policies, implementing them has remained a challenge, according to the World Bank.<\/p>\n

\u201cInvestors hate inconsistency and uncertainty,\u201d said Qimiao Fan, division director for Kenya, Rwanda, Somalia, Uganda, Africa at the World Bank.<\/p>\n

Find more news and analyses on Kenya<\/span> on the Africa Press<\/span> website<\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – Kenya. KENYA has the most expensive power among key African economies and neighbouring countries, an industry report shows. This, the private sector says, is making the country\u2019s manufacturing sector uncompetitive compared to other exporting markets and unattractive to new major industrial investments. The Regulatory Audit Report by the Kenya Association of Manufacturers, with […]<\/p>\n","protected":false},"author":84,"featured_media":160085,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5],"tags":[544],"class_list":["post-160087","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","tag-kenya"],"yoast_head":"\nKenya's Electricity Most Expensive in Africa Report - kenya<\/title>\n<meta name=\"description\" content=\"-article-header-tag"> Africa-Press - Kenya. 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