How Kenya Power lost Sh11.8 billion

Staff from Kenya Power company disconnect an illegal electricity connection power line to tens of families in Sakutiek village on the border of Nakuru and Narok during a sting operation. The company is losing over Sh200m every month in revenue in Central Rift due to illegal connections and vandalism of transformers and conductors.[FILE/Standard]

The government’s subsidy aimed at reducing electricity prices and stabilising the shilling has cost Kenya Power Sh11.84 billion in revenue.

The power distributor posted a Sh24.47 billion profit after tax for the year ended June 2025, marking a drop from the Sh30 billion recorded in a similar period last year.

The profit decline comes barely a year after the power distributor returned to profitability, following a Sh30.1 billion profit surge after a prolonged loss-making streak.

Despite selling more electricity in the review period, Kenya Power's revenues dipped to Sh219.29 billion from Sh231.12 billion a year earlier following the application of a lower base tariff.

Last year, Kenya Power sold 11,403 Gigawatt hours (GWh) of electricity, representing an eight per cent growth from the previous financial year.

According to Managing Director Joseph Siror, the base tariffs have been on a downward trajectory since 2023.

“The base tariff is coming down, and that is why even if we sell more, still the revenue you get is less,” said Siror during the release of the firm's financial results in Nairobi yesterday.

“We sold more units, but we got less revenue. If we had sold the same units in the other financial year, our revenue would have been much worse than this,” he said.

Kenya Power and Lighting Company Chairman Board of Directors Joy Masinde as they announced audited Financial results for the year ended 30, june 2025. They announced a profit of 24 billion which has reduced from 30 billion from last year. [ Jenipher Wachie, Standard]

The power distributor’s boss noted that the disparity between revenue and units sold highlights the government’s commitment to reducing electricity costs.

The Sh11.84 billion revenue loss from the previous year has also been attributed to the stabilisation of the shilling against other currencies.

“This decline was mainly due to reduced foreign exchange recoveries following the sustained stability of the Kenyan shillings,” said Siror.

“The forex has a direct impact. Last year, we benefited from a forex market shift of Sh7.8 billion, from translation of loans,” Kenya Power’s Finance Manager Stephen Vikiru said, adding that while stability is good, trading in the local currency only has a direct impact on profitability.

The distributor has, however, said having met the growth demand and reduced system losses for efficiency, and revenue growth in terms of units, the tariff reduction did not have a huge impact on its revenues.

The company is implementing an approved base tariff reduction path to balance utility sustainability with electricity affordability for customers.

The largest increase in sales was attributed to a significant recovery in foreign exchange. Furthermore, the distributor has invested Sh29 billion in grid expansion, smart metering, automation, and ICT.

The board has recommended a final dividend of Sh0.80 per ordinary share for the period ending June 30, 2025, in addition to the Sh0.20 interim dividend already paid.