World Bank says Kenyan businesses pay about half as much again for power as Ugandan ones, and points to costly power deals
The bank's new Kenya Economic Update links high tariffs to contracts with private power plants, most signed without competition, and to heavy grid losses. Nigeria has argued over the same problems for years.
In 30 seconds
- Kenyan businesses pay about Ksh22.60 a unit for electricity, close to 50 per cent more than in Uganda, the World Bank's November Kenya Economic Update says, as reported by several Kenyan outlets.
- Households pay about Ksh28.40 a unit, against Ksh22.20 in Uganda.
- The report cites an earlier finding that only 24 per cent of Kenya Power's 42 power purchase agreements went through competitive bidding.
- More than 23 per cent of the power generated is lost before it reaches customers, Dawan Africa reported from the report.
Electricity in Kenya costs far more than in its neighbours, and the World Bank says the way power deals were signed is part of the reason.
What the report found
The bank's Kenya Economic Update, Edition No. 34, published this month, compares electricity prices across countries. Kenyan businesses pay about Ksh22.60 per kilowatt-hour, against Ksh15.20 in Uganda and Ksh10.10 in Vietnam, Kenyan outlets reported. That puts Kenya close to 50 per cent above Uganda. Households pay about Ksh28.40, against Ksh22.20 in Uganda and Ksh15.40 in Morocco.
Dawan Africa, which gave the report's figures in US cents, put Kenya's business rate at 17.5 cents a unit and Uganda's at 11.8 cents.
The power deals
Kenya Power buys much of its electricity from private plants under long contracts. The report cites an earlier, 2021 finding that only 24 per cent of 42 such contracts were awarded through competitive bidding. Some contracts require payment even when the power is not used, the reports say.
The report also says some officials who approved power projects later worked for, or owned, the companies involved. Dawan Africa stressed that these are allegations. We found no response from Kenya's energy ministry, the regulator EPRA or Kenya Power in the reports.
Losses on the grid
More than 23 per cent of the power Kenya generates is lost before it is billed, Dawan Africa reported from the report, well above the 16.5 per cent target set by EPRA. Every lost unit still has to be paid for, and that cost ends up in customers' tariffs.
We could not open the World Bank's own report. The figures here come from four outlets that describe it and agree with each other.
What it means for you
Nigeria knows this story. Its grid also loses a large share of power before billing, and the government still owes power plants under contracts signed years ago. Kenya's case shows that how power deals are signed matters for decades: a contract agreed without competition can keep tariffs high long after the people who signed it have moved on. Nigeria's plan for its power sector debt.
Words to know
- Power purchase agreement (PPA)
- A long contract under which a utility agrees to buy electricity from a private power plant at a set price.
- Take-or-pay
- A PPA term that makes the buyer pay for power the plant can supply, whether or not it is used.
- IPP
- Independent power producer, a privately owned power plant.
Sources
- Kenyans.co.ke: World Bank links high electricity costs to opaque power deals (5 Nov 2026)
- Dawan Africa: Kenya's expensive power problem (4 Nov 2026)
- Nairobi Wire: World Bank on Kenya's high electricity costs (6 Nov 2026)
- Kenya Today: World Bank links Kenya's high electricity prices to opaque PPAs (5 Nov 2026)
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