Heads to roll at power firm, Energy PS Kihalangwa says

Mercy Mwai and John Otini Heads will roll at Kenya Power to pave way for reforms, Energy Principal Secretary Gordon Kihalangwa has said. Kihalangwa yesterday told MPs that in the next 21 days, the country will see major changes at the institution because of the goodwill from the government. “The goodwill we are getting from the government is welcome. In 21 days, we will be able to move. You will see changes. Certainly, we should be able to see some heads rolls for reforms to take place,” he said. Appearing before the Public Accounts Committee of the National Assembly chaired by Opiyo Wandayi (Ugunja MP) to respond to audit questions for the Financial Year 2018/19, Kihalangwa told the lawmakers that two Independent power firms are already seeking renegotiation of their contract. Kihalangwa noted that the move is an indication that they have realised that crimes were committed when the contract was crafted, that is why they are ready to remedy the situation. “With regards to IPPs, we are looking at this matter differently, already, some two companies have approached us and want to negotiate their contracts because they have seen there are crimes committed,” he added. Credible leaders His sentiments came at a time the report on the Presidential Taskforce on Power Purchase Agreements recommended that IPPs cut their tariffs paid by Kenya Power by half to match KenGen prices. In a raft of measures that would save consumers billions of shillings, the task force also advised that all power purchase agreements that are in the pipeline but have not been signed be suspended. “KPLC uses KenGen’s prices as the pricing benchmark, with very clear justifications required to exceed the KenGen prices,” says the report. Findings indicate that IPPs are getting more than their fair share having over stated the cost of their projects hence getting more capacity charges from Kenya Power. Due to over stating costs they got more government support than would otherwise have been. IPP owners also failed to meet the minimum cash equity, which is 25 per cent of the total project costs. Cost of fuel procured by most of the thermal generators was also higher than the market average. Kihalangwa, who was accompanied by various parastatal heads said that although they are determined to deal with the challenges at the institution, he admitted that it will not be easy to address all the problems as they are deeply entrenched. Currently, the PS noted that losses emanating from system failure account for 24 per cent, translating to between Sh45 billion to Sh50 billion while dead stock amount to Sh9.8 billion. Most of the huge losses, he said, are linked to big companies and industries in the cement and steel sector, which he said they are trying to deal with by installing tamper proof meters and gadgets. In addition, the PS also cited the human resource aspect, where some staff who are supposed to work 24 hours only work for three hours and as a result it takes longer hours to tackle problems. Major challenge “We have been working on the taskforce report. We hope that before December, the tariffs should have come out. The major challenge in this sector is lack of synergy among the semi-autonomous agencies. Issues at KPLC are a kind of cancer disease as they are so entrenched even among staff,” he added. “If you ask Kenya Power staff whether we have a problem, they will say we have no problem yet the challenges we have here are so entrenched. If this institution collapses all development projects will go down,” he added. Kihalangwa was responding to questions from committee members including Wandayi, Aden Duale (Garissa Township) and Joseph Nduati (Gatanga), who sought to know when the power tariffs would come down. Nduati sought to know whether reforms will happen at Kenya Power and why there are so many stalled projects while Duale questioned the government’s move to take over the firm, which is a listed company at the Nairobi Stock Exchange.

Heads to roll at power firm, Energy PS Kihalangwa says

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Heads to roll at power firm, Energy PS Kihalangwa says

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