In today’s world, electricity is a basic necessity for modern living, but for many Kenyans, it is slowly becoming a luxury that most can’t afford. From industries to homes, the cost of electricity is weighing heavily on Kenyans. Businesses and households that haven’t already felt the pinch, will soon feel the effects as the costs are set to go even higher in the coming times.
Electricity prices in the country have recently increased upwards of almost 50% as at April 2023, after the Energy and Petroleum Regulatory Authority (EPRA) approved the new tariffs proposed by Kenya Power and Lighting (KPLC), seeking to reduce the subsidies that buffer low-income households.
The impact of this? In the commercial and industrial sector, increasing costs of electricity means higher costs of production which trickles down to increased costs of the end products. Per Stima Tracker the cost per kWhr in February 2022 was 17.15 KES for a Commercial and Industrial client in CI-1 category. One year later, the February 2023 rate was 20.91 KES / kWhr – a 22% increase in the past year! 22% increase + the additional increase on the horizon = power is EXPENSIVE! The status quo cannot be the way forward. Doing nothing is no longer an option.
Source: Stima Tracker
The net effect is that it will be harder for businesses to compete in local and international markets, which will in turn reduce their profitability and growth prospects. This may be felt more by small and medium sized enterprises (SMEs) that have limited financial resources to absorb the increasing costs. Furthermore, businesses may experience reduced productivity as they are forced to cut down on energy usage to control costs. High costs of electricity can eat into an organization’s profit margins and end up limiting its ability to innovate and expand.
The common mwananchi will definitely be affected by the increase as the cost of living will go up, making it difficult to purchase and operate electrical appliances. Households may experience reduced disposable income and economic opportunities particularly the ones who rely on home-based income-generating activities.
Good news? Transitioning to renewable energy is more viable today than ever before and can help cushion the impact of increased power tariffs. Solar energy is an efficient, cost-effective and sustainable source of electricity that can be used to power homes, businesses and even entire communities. With advancements in solar technology in recent years, payback periods for commercial and industrial solar PV systems have become phenomenal, ranging from 3-5 years. The costs of installation of a solar PV system at your factory or household has reduced significantly compared to previous years and it is now very affordable. Project IRRs are great, making investment in solar energy quite attractive. Wouldn’t it be nice to not only have affordable but clean power to run your business or household and cut down on your electricity costs?
The sun is here to stay and so is solar energy. There is need for energy conservation and efficiency for a sustainable future. You can be part of the change that makes a difference. Ariya Finergy is here as Your Power Partner – make the decision now and go solar!
Contact Ariya Finergy today on info@ariyafinergy or +254700784330 and let us walk the journey to a greener economy with you.