The interior ministry in Gaza, run by Islamist movement Hamas, said in a statement the decision was made after a meeting between security chiefs and political movements in the Palestinian enclave.
It did not say how many people were being released, but rights activists said it involved dozens of people.
A series of protests were held in the Gaza Strip in recent days, including one on Thursday when thousands in northern Gaza walked to the local headquarters of the electricity company.
A prominent comedian was also detained on Wednesday after he posted on social media a call for Hamas to give up power.
The Gaza Strip had been left with around four hours of electricity per day recently as winter temperatures drove a spike in demand.
Gaza's electricity authority said today it was returning to providing power in eight-hour intervals after Qatar pledged USD 12 million toward resolving the problem.
The strip's sole electricity plant has seen fuel shortages in a dispute over unpaid bills and taxes with the Palestinian Authority, based in the occupied West Bank and dominated by Palestinian president Mahmud Abbas's Fatah party.
The PA then requires Hamas to reimburse it for bills and taxes, but Gaza's electricity authority faces cash shortages because nearly 70 per cent of households do not pay their bills, either because of poverty or lack of collection, the UN estimates.
The power plant, which has also been previously bombed by Israel, already functioned below capacity even before the recent crisis.
Israel's decade-long blockade of the Gaza Strip further complicates the situation. Israel and Palestinian militants in Gaza have fought three wars since 2008.
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