The Kenya Renewable Energy Association (KEREA) and GOGLA are urging lawmakers to maintain VAT exemptions on solar equipment in the 2025 Finance Bill.
- •They say proposed 16% VAT on solar equipment under Kenya’s 2025 Finance Bill would cause the price of a typical off-grid solar home system, used by millions of Kenyan families, to surge by Ksh 2,000.
- •According to GOGLA, the global association for the off-grid solar industry, the tax hike risks shrinking Kenya’s off-grid solar market by 20% in the next 12 months.
- •This would roll back a decade of progress in expanding electricity access, especially in remote and underserved communities.
“This is not merely a theoretical concern,” said Patrick Tonui, Head of Policy and Regional Strategy at GOGLA. “When VAT exemptions were previously withdrawn in 2020 and 2021, the off-grid solar market contracted by 20%. Reintroducing VAT now risks repeating that experience — dampening demand, reducing tax revenues, and making solar less accessible for the households and enterprises that need it most.”
Cynthia Angweya-Muhati, CEO of the Kenya Renewable Energy Association (KEREA) noted that Kenya has made strong progress in expanding energy access, especially in underserved regions.
“Electrification in these regions remains well below the national average, with some counties as low as 15 percent. Reintroducing VAT could make solar unaffordable for those who need it most and risk slowing progress toward universal access,” Angweya-Muhati said.