Unpacking Mbadi's Sh318b budget for energy and transport sectors

Treasury CS John Mbadi lifts the budget briefcase at Parliament on June 12, 2025. [Boniface Okendo, Standard]

The government plans to spend approximately Sh256 billion in the 2025/26 financial year to construct, rehabilitate, and maintain key transport infrastructure across the country, beginning July 1.

In his maiden budget speech to Parliament, Treasury Cabinet Secretary John Mbadi underscored the strategic role of investments in roads, railways, water, and air transport in driving economic growth and facilitating seamless trade.

“The government will continue to invest in transportation networks including roads, railways and air travel to reduce travel times and logistics costs, making markets more accessible and facilitating the movement of goods and people,” Mbadi said.

Roads are set to receive the lion’s share of the allocation, with Sh217 billion earmarked for new developments and maintenance. Of this, Sh30 billion will go towards the construction of new roads and bridges, while Sh70.8 billion is allocated for repairs.

The budget also proposes Sh115.6 billion for the continued upkeep of national highways and other roads, marking a notable increase from the Sh85 billion allocated in the previous financial year.

In a push to revitalise rail transport, the government will channel Sh38 billion towards the sector. 

The funds will be used for new equipment, the construction of additional rail facilities, and the maintenance of existing lines, including both the Standard Gauge Railway (SGR) and the older Meter Gauge Railway. Expansion plans for phases 2B and 2C of the SGR are also in progress.

“I have also proposed an allocation of Sh450 million for the Kenya Ferry ramp in Mombasa, Sh331 million for the Nairobi Bus Rapid Transit (BRT) project, and Sh298 million to promote e-mobility initiatives,” said Mbadi.

Water transport on Lake Victoria will receive a boost as well, with Sh110 million allocated for the acquisition of ferries to support inland navigation and regional connectivity.

However, the budget speech was silent on the government’s specific plans for the aviation sector—an area that has drawn growing public concern due to the deteriorating state of facilities such as the Jomo Kenyatta International Airport (JKIA).

Despite this omission, the overall allocation reflects the government’s intent to modernize Kenya’s transport system and support long-term economic transformation through improved mobility and logistics.

Meanwhile, CS Mbadi has proposed a Sh62.8 billion budget for the energy sector comprising Sh31.6 billion for expanding the national power grid and Sh16.3 billion for the rural electrification programme.

Geothermal power generation efforts will account for Sh11.5 billion while development of nuclear energy will take Sh743 million.

A further Sh2.1 billion will go into alternative energies.