3 December 2017

Kenya: Cheaper Off-Peak Power Signals Cut in Cement Cost

Cement companies intend to lower their prices and achieve regional competitiveness following the reduction in local off-peak power prices.

Savannah and National Cement brand makers said they saw demand for local cement rising as Kenya becomes more competitive as a source of commodity.

Cement maker Devki Group Raval Narendra said Kenya's cement would now be more competitively priced locally and at the regional level.

"Kenya's image as an investment destination will improve since its power prices are coming down. It is easier now to determine lower prices since our profit margins allow it," he said.

Speaking to the Press separately, Savannah Cement managing director Ronald Ndegwa said the 50 per cent power charge reduction between 10pm and 6am would unlock money that could be spent in improving operations hence boosting sales.

"That is money straight into our pockets as we spend between Sh40 million and Sh50 million a month. We operate 24 hours a day and such a move will positively impact on our customers," he said during the firm's five-year celebrations at their Kitengela-based plant.

Mr Ndegwa said the slash amounted to nearly a quarter of their current power charges which gave them an opportunity to relook at their investments.

He said their 1.2 million metric tonnes plant that will manufacture road making cement was still under construction and is slated for completion late next year.

President Uhuru Kenyatta's directive issued last Tuesday took effect at midnight (December 1) where manufacturers will have their electricity consumption during the low peak period between 10pm-6am period halved.

Savannah also reaffirmed their commitment to improve construction work by signing a pact with the National Construction Authority (NCA) allowing the firm's facilities to be used as an experiential training centre for building contractors and masons.

NCA Board Chairman Stephen Waundo said training of contractors, masons and other building construction professionals was aimed at improving the quality of buildings and other structures that improve Kenyans' livelihoods.

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