Kenya Power's revenue from electricity sales to new customers declined by Sh1.07 billion in the year to June, despite an increase in connections. The utility's new customers consumed 161.7 Gigawatt-hours (GWh) of electricity, a 20 percent drop from 202.98 GWh in the previous year. This decline pulled down revenues from this customer segment to Sh4.05 billion from Sh5.12 billion, a 26.41 percent drop.
The dip in unit sales and revenues came despite Kenya Power connecting 412,249 new customers in the 12 months to June 2026, up from 401,848 the previous year. More than half of the new customers, or 226,803, were commercial customers. The utility also connected 539 new large consumers, referred to as premium customers, and added 184,907 clients under the Last Mile Connectivity Project (LMCP).
Kenya Power's overall electricity revenue from all customers, including existing ones, grew by Sh18.9 billion to Sh238.24 billion. However, the decline in electricity sales to new customers may indicate subdued economic expansion and increased adoption of off-grid solar alternatives. Insiders in the energy sector suggest that a drop in electricity sales to new customers, dominated by commercial clients, is generally a sign of a slowdown in business expansion, industrial activity, or overall economic growth.
Kenya's economic growth slowed to 4.6 percent in 2025, down from 4.7 percent in 2024, continuing a multi-year cooling trend from post-pandemic highs. The Treasury has revised Kenya's economic growth outlook for 2026 downwards to 5.0 percent from the earlier projection of 5.3 percent amid stubborn inflation. A growing number of electricity consumers, especially large commercial ones, are turning to solar energy to lower their electricity bills and ensure reliable supplies.
Many businesses are increasingly shifting to solar to cut costs and ensure stable and reliable electricity supply. The country's captive power installations in the commercial and industrial sector hit a landmark 630 megawatts by early 2026, driven by high grid tariffs and a growing shift toward private self-generation. Firms such as Bamburi Cement, TotalEnergies Marketing Kenya, and Carbacid Investments have recently set up solar power plants.
Kenya Power is also grappling with low consumption by beneficiaries of the Last Mile Connectivity Project (LMCP) initiative amid lingering questions about the return on investment in the subsidized power connection scheme. The African Development Bank (AfDB) raised concerns about the low usage of electricity by LMCP beneficiaries, calling on the government to come up with a fund to help them set up businesses, boost their livelihoods, and spur power consumption.
The reduction in the base tariff across all consumer categories also negated the impact of increased unit sales of electricity. The cost of a kilowatt-hour (kWh) has been dropping year on year, with the managing director of Kenya Power stating that the tariff has been reduced by Sh0.70 per unit on average year on year. Higher consumer tariffs could have allowed Kenya Power to raise more cash from electricity sales, affording them room to fund critical projects.
Key points
- Revenue from electricity sales to new Kenya Power customers dropped by Sh1.07 billion despite increased connections.
- Kenya's economic growth slowed to 4.6 percent in 2025, down from 4.7 percent in 2024.
- The country's captive power installations in the commercial and industrial sector hit a landmark 630 megawatts by early 2026.
