EPRA Moves to Contain Fuel Costs After Capping KPC Pipeline Tariffs

EPRA Moves to Contain Fuel Costs After Capping KPC Pipeline Tariffs

The Energy and Petroleum Regulatory Authority has stepped in to cushion Kenyan consumers from a possible fresh spike in fuel prices after approving lower-than-requested pipeline transport tariffs for the Kenya Pipeline Company in a move expected to ease pressure on pump prices over the next three years.

In a gazette notice published on Friday, May 15, the regulator unveiled a new multi-year tariff structure that will govern fuel transportation charges through KPC’s pipeline network from the 2025/26 financial year through to 2027/28.

The decision comes at a sensitive moment when the country is grappling with soaring fuel prices, nationwide protests by matatu operators, and increasing pressure from consumers over the rising cost of living.

Under the approved structure, EPRA retained the current pipeline transport tariff of Ksh5.44 per cubic metre per kilometre for the 2025/26 financial year. The regulator then approved only gradual increases to Ksh5.53 in the 2026/27 financial year and Ksh5.83 in the 2027/28 financial year.

“Pursuant to section 11(c) of the Energy Act, 2019, the Energy and Petroleum Regulatory Authority (EPRA) hereby gives notice of the approved multi-year pipeline transport tariff for the Kenya Pipeline Company Limited (KPC) for the period 2025/2026 to 2027/2028,” EPRA stated in the notice.

“The approved multi-year pipeline transport tariff shall be applicable for a three-year control period commencing on April 15, 2026, to April 14, 2029,” the notice added.

The approved rates were notably lower than what KPC had requested, effectively shielding consumers from what analysts describe as a “hidden fuel increase” that would have further raised pump prices across the country.

In its proposal to the regulator, KPC had sought permission to raise the tariff to Ksh5.56 per cubic metre per kilometre immediately and gradually increase it to Ksh6.61 by the 2027/28 financial year.

The state corporation argued that the additional charges were necessary to finance pipeline upgrades, maintain ageing infrastructure, and support future expansion projects aimed at improving fuel transportation efficiency nationwide.

However, EPRA appears to have taken a more cautious approach amid the growing public anger over fuel costs.

Energy sector experts note that pipeline tariffs directly influence the final retail cost of petroleum products because transport charges are factored into depot and pump pricing calculations.

Had EPRA approved the higher tariffs proposed by KPC, consumers in Nairobi and inland towns such as Nakuru, Eldoret, Kisumu, and Western Kenya would likely have faced even higher fuel prices in the coming months.

The regulator also scaled back regional depot charges proposed by KPC, further reducing potential cost burdens for fuel marketers and consumers.

In Nairobi, KPC had proposed raising the terminal tariff to Ksh2,912.27 per cubic metre, but EPRA approved a lower figure of Ksh2,851.80.

In Kisumu and Eldoret, the regulator similarly rejected the full amounts requested by the pipeline company.

Instead of approving the proposed Ksh4,330 per cubic metre, EPRA capped the charges at Ksh4,234.41 for Kisumu and Ksh4,238.42 for Eldoret.

The latest intervention comes just days after EPRA’s monthly fuel review triggered outrage among transport operators and consumers alike.

Earlier this month, diesel prices increased sharply by Ksh46.29 per litre while petrol prices rose by Ksh16.65 per litre, sparking a nationwide strike by matatu operators beginning Monday, May 18.

Public transport operators argued that the diesel increase had made operations unsustainable, warning that commuters would ultimately bear the burden through higher fares and transport shortages.

Although the government later revised diesel prices downward by Ksh10.06 following consultations with transport stakeholders, operators maintained that the reduction was insufficient and continued with the strike.

Industry observers say EPRA’s latest tariff decision signals growing concern within government over mounting pressure from high fuel prices and their ripple effect on transport, food prices, and the broader economy.

For many Kenyans already struggling with inflation and rising living costs, the regulator’s move may offer temporary relief, even as concerns over long-term fuel stability remain unresolved.

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EPRA Moves to Contain Fuel Costs After Capping KPC Pipeline Tariffs