Kenya Power shelves bid to hike electricity cost after uproar
Business
By
Macharia Kamau and Eucabeth Nyarianya
| Jun 04, 2026
Energy and Petroleum CS Opiyo Wandayi addresses the Press, flanked by PS Alex Wachira.at Kawi Complex in Nairobi, on June 3, 2026. [Edward Kiplimo, Standard]
The government has yielded to public pressure and directed Kenya Power to withdraw an application it had made that would have seen power prices go up, adding further strain for Kenyan households and businesses.
Kenya Power had made the application to the Energy and Petroleum Regulatory Authority (Epra) on March 31 this year, seeking approval to increase the base power cost for different consumer segments.
The new tariff was expected to become effective July 1 after a public participation process. Epra previously approved a power tariff review in April 2023, which was expected to be implemented over three years to April 2026.
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The application has, however, raised concerns about the high cost of electricity for households that are already grappling with inflation, high food prices and a recent increase in fuel costs, as well as businesses that said the hike in power costs would result in high production costs and a subsequent increase in the cost of basic goods.
Energy Cabinet Secretary Opiyo Wandayi said the withdrawal of the application was in consideration of the impact higher power costs would have on the economy.
“Following consultations within government and engagement with key sector stakeholders, the retail electricity tariff review application submitted on 31st March 2026 by KPLC [Kenya Power] has been withdrawn. This decision reflects the need to buttress a sustainable energy sector while protecting households, businesses, and industries from cost escalation. It aims to support economic growth, safeguard livelihoods and create jobs,” said Wandayi.
“Following the withdrawal of the application, the current retail electricity tariffs shall remain in force and unchanged, unless otherwise lawfully reviewed in accordance with the Energy Act and applicable regulatory procedures.”
While the government has frozen the imminent hike in power prices, the other components of the power bill that change often could still push up the cost of electricity in the country.
The law gives Epra the leeway to review the Fuel Cost Charge, the Foreign Exchange Rate Fluctuation Adjustment (Ferfa) and the water regulatory management levy every month to reflect such realities as a sudden increase in fuel costs and the weakening of the shilling against major currencies.
It also reviews the inflation adjustment every six months. The cost of fuel has been on the rise in recent months following the crisis in the Middle East, which is expected to reflect in power bills as thermal power producers pass the cost of acquiring heavy fuel oil they use to generate electricity.
Inflation adjustment is also likely to go up to reflect an increase in the inflation rate to a near four-year high of 6.7 per cent.
Even as the withdrawal of the tariff application comes as a relief for households and businesses, it could also see the sector take a financial hit.
The tariff application considers the needs for the entire sector, including the financing needs, infrastructure growth and operational costs.
Kenya Power is the public-facing entity for the sector, collecting revenues on behalf of other sector players, including power producers and the electricity transmission firm Ketraco.
It could mean a strain for Kenya Power, which experienced a Sh11.84 billion revenue dip in the year to June 2025, resulting in its profit after tax dropping to Sh24.46 billion from Sh30 billion in 2024.
In responding to queries on the sector’s financial sustainability following the freeze on the tariff hike, Wandayi said: “All that has been taken care of, and the government, in its usual innovative ways, working with those in the sector, is more than convinced that the current tariff structure is sustainable.”