Nairobi, Jan. 10 -- The weakening of the shilling inflated KenGen's foreign currency loans by Sh3.2 billion in the year ended June, with the foreign exchange volatility forming part of costs that the company and other power producers pass on to electricity consumers.

The unrealized loss on revaluation of borrowings in the review period reversed a gain of Sh701.2 million that the Nairobi Securities Exchange-listed firm reported a year earlier.

KenGen also disclosed in its latest annual report that it incurred an actual loss of Sh606.1 million when repaying part of its foreign currency-denominated loans in the review period.

This was down from the loss of Sh954.2 million incurred the year before. The company has borrowings in US dollars,...