Kenya Power #ticker:KPLC has disclosed that small businesses were the only category of consumers that increased consumption of electricity in the year to June as the micro-enterprises emerge as the engine of growth in the slowing business.
Power sales to small enterprises jumped to Sh26.5 billion in the year to June, up from Sh15.8 billion a year earlier, a reflecting a 68 per cent increase.
Consumption dropped for large businesses and industries that cut back on electricity purchases by Sh2.8 billion in the period to Sh43.2 billion.
The cutback also hit homes, categorised as domestic customers, with their power purchases falling by Sh2.5 billion to Sh21.8 billion despite a significant rise in new connections.
Power consumption is often an indicator of the number of electrical equipment plugged into the national grid — including industrial machinery — pointing to economic output.
It may also be the result of increased use of home appliances such as TV sets and refrigerators that point to improvement in household incomes and rising standards of living.
The electricity consumption data tallies with the Central Bank of Kenya observation that small- and medium-sized enterprises in wholesale and retail, transport and storage and real estate sectors remained vibrant, blunting the impact of the slowing economy.
“These are the ones that have been the backbone of the resilience we have seen so far in 2017,” said Central Bank of Kenya governor Patrick Njoroge earlier, adding that the three sectors account for 18 per cent of annual economic output.
The bulk of the Kenyan economy is in the informal sector.
The governor said most small businesses in that sector rely on borrowing from friends or family, explaining their resilience amid reduced bank debt following the state control of interest rates.
Kenya’s economy grew more slowly in the second quarter ended June than during the same period last year due to a weaker performance in agriculture, manufacturing and financial service sectors.