Shutdown of Kenya’s Koko Biofuel Firm Wipes out Clean Cooking Options

February 06, 2026

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by Allan Olingo (The Associated Press/Winnepeg Free Press) It was designed to be as simple as buying airtime: a quick tap on the dispenser, a few shillings and a cooking canister refilled. Now, more than 3,000 Koko fuel supply points across Kenya sit idle, with no fuel and no clear answers for the households that relied on them.

For more than a decade, Koko Networks helped shift over 1.5 million Kenyan homes without access to public gas systems away from smoky charcoal stoves to bioethanol, marketed as a cleaner, modern way to cook. The steady blue flame became a symbol of Kenya’s push toward cleaner household energy.

That promise has dimmed.

After failing to win government letter of authorization that would allow them to sell carbon credits — permits that allow holders to emit certain amount of greenhouse gases — Koko abruptly shut down its fuel distribution network, bringing to a halt a model once hailed as a poster child of Africa’s green transition.

Stoves shut down as Koko closes

In Kibera, Nairobi’s largest informal settlement, most Koko Networks outlets have closed, and some have removed the bioethanol dispensers altogether. Since 2014, Koko had imported bioethanol products. That ended abruptly in 2023 when the government withheld its import permit, forcing Koko to use local sources that were erratic and more expensive.

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For weeks, Koko and the Kenyan government haggled over a crucial letter authorizing carbon credits and import permits for bioethanol made from molasses, a sugarcane byproduct. The company needed those approvals to unlock millions of dollars in international financing that helped keep fuel prices low. Kenyan authorities held back, citing broader concerns about the credibility of carbon credits.

Koko — which counted the Microsoft Climate Innovation Fund, and South Africa’s Rand Merchant Bank as its investors, announced on Jan. 30 that without the approvals its business model was financially unsustainable and it was shutting down.

“Koko’s case is uniquely multidimensional,” said David Ndii, Kenya’s presidential adviser on economic affairs. Ndii cited issues including the Paris Agreement framework, questions around the credibility of cookstove carbon credits, Kenya’s climate policies, carbon market regulations, the transparency of Koko’s business model and diplomatic considerations.

He dismissed the prospect of state intervention, saying, “Even good doctors lose patients.”

Kenya’s energy and treasury officials have declined to comment on the closure, which energy analysts say exposes weaknesses in how clean cooking is financed across Africa.

“The clean cooking situation in Kenya, and across Africa is a serious crisis,” said Amos Wemanya, a senior analyst on renewable energy at Power Shift Africa. “This is not just about emissions or climate targets. It is about development, health, dignity and household survival.”

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He said the Koko episode shows the priority should shift toward affordable electricity, especially in rural areas.

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“What are we supposed to do? Go back to using charcoal in our one-room houses?” (Margaret) Auma asked. “That is the smoke and sickness we were trying to escape.” READ MORE

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Koko Networks Placed Under Administration as Kenya’s Clean Cooking Startup Shuts Down (Innovation Village)
Kenya: Koko Networks lays of off its entire 700-person workforce and shut down operations after the government blocked its sale of carbon credits (Business and Human Rights Center)
Kenya’s Koko shuts down after carbon credit dispute with government (TechCabal)
Kenya biofuel shutdown ends clean cooking (The Rising Nepal)
Shutdown of Kenya's Koko biofuel firm wipes out clean cooking options -- In Nairobi's informal settlements, the closure of Kenyan supplier Koko Networks has left thousands of households without access to clean bioethanol cooking fuel (Ottumwa Courier)

Excerpt from Innovation Village: Kenya’s clean cooking ambitions have suffered a major setback following the collapse of Koko Networks, one of the country’s most prominent bioethanol distribution startups. The company and its subsidiary, Koko Networks Global Services (Kenya) Limited, have been placed under administration, days after operations across Kenya effectively ground to a halt.

Professional services firm PricewaterhouseCoopers has taken control of the business, with partners Muniu Thoithi and George Weru appointed as joint administrators on February 1, 2026, under Kenya’s Insolvency Act of 2015. From that date, control of Koko’s assets, operations, and strategic decisions shifted away from management to the administrators.

According to the statutory notice, the primary objective of the administration process is to assess whether the business, or parts of it, can be rescued as a going concern or whether a better outcome for creditors can be achieved than through outright liquidation. Creditors have been given 14 days to submit claims as administrators establish the full scale of liabilities facing the company.

By the time PwC stepped in, the collapse was already visible. On January 31, more than 700 employees were laid off as fuel distribution slowed and, in many areas, stopped entirely. Customers in low-income neighbourhoods—many of whom relied on Koko’s ethanol refills for daily cooking—were left without supply, receiving notification of the shutdown via a brief text message.

At its peak, Koko operated one of Africa’s largest clean cooking distribution systems, serving an estimated 1.3 to 1.5 million households through about 3,000 automated fuel dispensers in Kenya and Rwanda. The company positioned itself as a low-cost alternative to charcoal and kerosene, using digitally enabled cookstoves linked to smart fuel points to deliver ethanol at subsidised prices.

The root of Koko’s failure lies in a business model heavily dependent on carbon credits. The company sold two-burner smart stoves at heavily subsidised prices and kept fuel costs low, betting that revenues from international carbon markets—earned by households switching to cleaner cooking—would offset operating losses. Investors reportedly tied more than $300 million in equity, debt, and guarantees to this assumption.

That revenue never materialised. Industry sources say Koko spent months seeking government approval to sell carbon credits internationally, only for the application to be rejected at a late stage. Without carbon income, the economics collapsed almost overnight.

Regulatory pressures had been mounting even before the final setback. In April 2024, Kenya’s Energy and Petroleum Regulatory Authority suspended bioethanol imports, forcing Koko to rely on more expensive local supply. Logistics challenges, tighter margins, and recurring fuel shortages followed, further weakening the business.

Despite backing from major institutions—including Microsoft’s Climate Innovation Fund, Verod-Kepple, Mirova, Rand Merchant Bank, and the World Bank’s Multilateral Investment Guarantee Agency—the company was unable to weather the regulatory and financial shock.

Koko Networks was founded in 2014 with the mission of transforming clean cooking in Africa by replacing charcoal and kerosene with affordable bioethanol. The founders designed a technology-driven model combining smart cookstoves, digitally tracked fuel canisters, and automated ethanol dispensing machines installed in neighbourhood shops.

Kenya became Koko’s primary market, where the company rapidly scaled a capital-intensive distribution network across major urban centres. At its peak, Koko served an estimated 1.3–1.5 million households through about 3,000 fuel dispensers, making it one of Africa’s largest clean-cooking platforms. Expansion into Rwanda followed but was later paused.

Koko’s exit raises broader questions about the sustainability of climate-focused startups in Africa, particularly those reliant on carbon markets amid shifting regulatory frameworks. Energy analysts warn the shutdown could push some households back to charcoal and kerosene, potentially reversing gains in public health and emissions reduction. READ MORE

Excerpt from Business and Human Rights Center: Koko Networks, a Kenyan clean-cooking startup, on Friday laid off its entire 700-person workforce and shut down operations after the government blocked its sale of carbon credits. A board member and an employee, who asked not to be named to speak freely, told TechCabal that the decision followed two days of intense meetings at the company’s Nairobi offices, where executives weighed their options after the Kenyan government rejected a letter of authorisation (LOA) critical to Koko’s business model of selling biofuels to low-income households.

On Friday, the Financial Times reported that the startup was facing bankruptcy after failing to get the government’s nod to sell carbon credits. Management informed staff of the immediate closure on Friday, telling them not to report to work the next day, according to people who spoke to TechCabal. “It’s been two days of intense deliberations on the matter,” the board member said. “We were facing bankruptcy because selling carbon credits is key to our business model.”

Koko’s shutdown could push about 1.5 million households back to dirtier, more polluting fuels like kerosene and charcoal. The company also employed over 700 direct employees and worked with thousands of agents operating over 3,000 automated refuelling machines.

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Koko sells biofuel, fuels derived from biomass, and stoves at subsidised prices. It relies on revenue from carbon credit sales abroad to fund these subsidies and its operations. The startup sells a litre of bioethanol at KES 100 ($0.77), compared with a market price of KES 200 ($1.54). The cost of the stoves is also subsidised at KES 1,500 ($11.53), against the market price of KES 15,000 ($115.3).

With the LOA rejection cutting off this crucial funding, the insiders said the company can no longer sustain its subsidised model. The shutdown comes barely a year after Koko secured a $179.64 million (KES 23.18 billion) guarantee from the World Bank to support its expansion in Kenya. The guarantee, provided through the Multilateral Investment Guarantee Agency (MIGA), the Bank’s political risk insurance arm, was supposed to protect the company against risks including civil unrest, land expropriation for public use, and breaches of contract. At the time, Koko had planned to add at least three million customers in Kenya by December 2027, an expansion that would have advanced the government’s push to grow the adoption of clean cooking fuels.

Founded in 2013 by Greg Murray to combat deforestation driven by the widespread use of charcoal, the startup has raised more than $100 million in debt and equity financing from investors like Verod-Kepple, South Africa’s Rand Merchant Bank, Mirova, and Microsoft Climate Innovation Fund. READ MORE