China Hydro-Power Company will next month, begin preliminary work for the construction of an electricity dam in Kenya.

The project, which is situated at Uasin Gishu county and cost an estimated Sh30 billion ($342 million), would help reduce high production cost in country, consequently attracting greater investments into East Africa’s industrial sector.

“High energy costs have caused skyrocketing costs of production. With the setting up of the hydro-power plant we expect this to reduce by 20 per cent, making the region more business friendly,” said Jackson Mandago, governor of the county.

It was reported earlier in May that some Kenyan manufacturers were considering moving their businesses across the region’s boarders as high energy costs continue to steal a huge chunk of their revenues. They have targeted Northern and Southern Africa for cheaper power.

This could negatively impact Kenya’s economy, as GDP would drop drastically and unemployment would skyrocket. Fortunately, the development of alternative sources of electricity such as dams should help reduce the enormous financial burden currently placed on manufacturers.

“Reducing the cost of power by coming up with other preferable options is a plus and one sure way of attracting and retaining investors,” said Charles Mose, chairman of Uasin Gishu’s chamber of commerce.

Source :