Kenya Power resumes Sh26.76bn cheap electricity project
Wednesday May 17 2023
Kenya Power has resumed the fourth phase of the last mile project that connects homes to the national grid at a subsidised cost which was stopped after local contractors were locked out.
Local contractors moved to Public Procurement Regulatory Authority (PPARB) in 2020 to challenge the project citing unfair treatment in the tendering process, delaying the project.
PPARB terminated the contract in February 2020 and ordered Kenya Power to retender within 45 days from the date of this decision which the distributor did not do.
The loss-making firm has now cancelled the 2020 tenders and invited new bids that should be submitted before now July 18, 2023.
“We tendered in February 2020 but local contractors went to the Public Procurement Regulatory Authority citing unfair treatment. We had to find a win-win for both local and international contractors interested in this tender,” a source familiar with the matter told Business Daily on condition of anonymity.
PPARB in its ruling in 2020 directed Kenya Power to “unbundled” or divide the tenders into smaller lots to allow the participation of local contractors.
Local contractors failed to make the cut for the tender protesting Kenya Power’s technical and financial specifications which they said mainly favoured moneyed foreign firms including Chinese contractors.
The utility has received Sh26.76 billion in funding from three multilateral lenders that will be used to connect a further 280,473 households across 32 counties to power.
The power distributor has received a loan of Sh13.38 billion (€90 million) from the French Development Agency (AFD), a grant of Sh4.46billion (€30 million) from the European Union (EU) and another loan from the European Investment Bank (EIB) of Sh8.92 billion (€60 million).
Kenya Power said on Wednesday that the new phase will include the installation of 940 new transformers, the maximisation of 3,735 existing transformers, and the construction of transmission lines in the identified counties.
Some of the counties that will benefit include Bomet, Bungoma, Busia, Embu, Homa Bay, Kajiado, Kakamega, Kericho, Kilifi, Kirinyaga, Kisii, Kisumu, Kitui and Kwale.
Other are Laikipia, Makueni, Meru, Migori, Murang’a, Nakuru, Nandi, Narok, Nyamira, Nyandarua, Nyeri, Siaya, Taita Taveta, Tharaka – Nithi, Trans Nzoia, Uasin Gishu, Vihiga and West Pokot.
The first phases of the project saw consumers get connected at a subsidised rate of Sh15,000 depending on their proximity to power lines and transformers, down from Sh35,000.
Beneficiaries must be located within 600 metres of a transformer.