Millions of Kenyan households and businesses received a rare piece of welcome economic news on Wednesday as Energy and Petroleum Cabinet Secretary Opiyo Wandayi announced an immediate reduction in electricity prices by KSh 0.2685 per kilowatt-hour, effective June 2026.
The announcement, made following a high-level consultative meeting between the Ministry of Energy and Petroleum and the Kenya Association of Manufacturers (KAM), delivers tangible relief to consumers who have endured months of escalating utility bills and a relentless rise in the cost of living.
“Effective June 2026, electricity costs have reduced by KSh 0.2685 per kWh. This reduction is driven by a significant drop in the Forex Adjustment component, a decrease in the Fuel Energy Cost (FEC) and increased hydropower generation,” Wandayi declared.
The CS identified three converging factors behind the price drop. First, the stabilization of the Kenya Shilling against the US dollar has significantly reduced the foreign exchange adjustment premium that consumers previously paid to cover import costs for independent power producers. Second, Kenya’s hydroelectric dams, replenished by heavy seasonal rains, are now generating power at elevated capacity, dramatically reducing the country’s dependence on expensive diesel-powered thermal plants. Third, lower global fuel prices have directly pulled down the Fuel Energy Cost component of electricity billing.
“This reflects our commitment to ensuring that gains within the sector are shared directly with Kenyans,” Wandayi affirmed.
The relief comes on the back of a difficult few months for electricity consumers. In May, EPRA raised electricity prices by KSh 1.10 per kWh following exchange losses incurred by power producers amounting to KSh 1.17 billion in April. The increase triggered widespread public outcry, particularly among low-income households and small businesses already struggling under the weight of elevated fuel costs.
The government moved further to protect consumers by suspending a controversial electricity tariff review application that Kenya Power had submitted to EPRA in March. The proposal, which sought to narrow the subsidised lifeline consumer bracket from 100 kWh to just 30 kWh per month, would have pushed millions of ordinary households into a higher-cost billing tier — raising their per-unit cost from KSh 14 to KSh 21.68. Its withdrawal is being received as a significant policy win for consumer advocacy groups.
“The government suspended the proposed electricity tariff review,” Wandayi confirmed, adding that the move was designed to cushion businesses and, by extension, households from further financial strain.
For manufacturers, the implications are particularly meaningful. KAM had warned that Kenya’s high electricity tariffs were eroding the competitiveness of locally produced goods on the regional market. The CS assured industry players that the government would continue engaging stakeholders to maintain a stable, investment-friendly energy environment.
Experts caution, however, that the sustainability of lower electricity prices hinges on continued favorable rainfall and a stable shilling — factors outside government control. For now, at least, Kenyans can expect lighter power bills in the months ahead.
