Kenya's manufacturing future is green, and it starts now

It is now clear that the future of Kenya’s industry hinges on clean energy. In a country that is generating over 90 per cent of its electricity from renewable sources—hydropower, geothermal, wind, and solar— Kenya is sitting on the cusp of opportunity that its industry must begin to exploit quickly. And it’s up to manufacturers to seize it.

One thing that needs to be clear to fellow captains of industry is that this isn’t just about saving the planet; it’s about saving our bottom line and securing our place in a rapidly changing world.

Kenya’s renewable energy credentials are the envy of Africa. Our installed capacity for electricity generation hit 2,988 megawatts in 2024, with geothermal alone accounting for 38 per cent, according to Kenya Power. That’s a powerful foundation for an industrial renaissance—one we can’t afford to squander. At HACO, we have made sustainability the heartbeat of our operations. Solar panels now power parts of our production lines, and we are chasing efficiency with every watt we use. Our Chasing Zero Initiative isn’t a buzzword; it’s a roadmap to slash our carbon footprint while keeping our business humming. And it’s working.

Let’s talk numbers. Energy costs are a beast for Kenyan manufacturers, often accounting for up to 20-30 per cent of production expenses, according to industry estimates. Power bills have spiked as demand has climbed, and the national grid, while greener, isn’t immune to disruptions.

Clean energy flips that script. Though the upfront cost of solar arrays or wind turbines stings—think millions of shillings for a mid-sized setup—the payoff is real. Our company has cut reliance on grid power. We have insulated ourselves from price swings, and seen our energy bills shrink over time. It’s a no-brainer for any manufacturer with an eye on the long game.

But this isn’t just about savings—it’s about staying competitive. Global trade is turning green fast. The European Union’s carbon border tax, set to hit imports by 2026, is a wake-up call. Buyers in London or New York don’t just want quality goods; they want them made sustainably.

Kenya’s Vision 2030 economic development blueprint pushes green industrialisation, dangling tax breaks and incentives for companies. Investors notice when you’re ahead of the curve—our sustainability pivot has already sparked interest from impact funds.

Then, there is the consumer angle. Today’s customers aren’t the passive buyers of a decade ago. They are asking: Where did this come from? How was it made? Using clean energy isn’t just compliance—it’s a badge of honour. It builds trust, boosts brands, and keeps them a cut above the competition.

Still, the road to a green manufacturing sector isn’t all smooth. Small and medium-sized firms—vital to Kenya’s economy, and employing 80 per cent of the workforce—face a steep climb. A solar setup might cost Sh10 million and green loans are scarce. Many lack the capital or know-how to make the leap. That’s where teamwork comes in. Industrialists need public-private partnerships to bridge the gap—think subsidised financing or shared renewable hubs. Smart grids and energy-efficient tech could level the playing field, but they are not scaling fast enough.

So far, the government has been doing its part, pouring billions into projects like the Olkaria geothermal fields. Private players like us must step up too.

- Ms Musangi is the Managing Director of HACO Industries