A lawmaker has questioned power purchase agreements between Kenya Power and Independent Power Producers saying the rates are inflated.
Garissa Township MP Aden Duale has sought a statement from the Energy ministry to shed light on the agreements, which brings an additional Sh17 per unit charged to consumers.
The MP says the power supply regime has regressive effects on the already overburdened taxpayers and businesses.
He cited data indicating that KPLC procures electric power from independent electricity power producers at an inflated rate of Sh23 per kilowatt hour.
This, Duale said, compares lowly to the Sh0.5 per kilowatt hour charged by KenGen. The state power producer, though, says it charges Kenya Power Sh5.
The MP said he has reliable information that the IPPs normally purchase electricity from KenGen at 50 cents per kilowatt hour before offloading it to Kenya Power at an inflated rate of Sh23 per kilowatt hour.
In what may be the biggest scandal in the power sector, the Star is reliable informed that the entities rake in over Sh100 million a month in power sales, yet pay only Sh23 per unit.
The firms are reportedly owned by powerful individuals with strong connections with the politicos in the country, even as experts cite a ripoff on the part of taxpayers.
The expensive power purchase agreements are blamed for the imminent collapse of KPLC which is burdened by debts to the tune of Sh7.6 billion.
Duale said the undertakings stand to threaten the long-term growth of the country’s economy, hence his request for the inquiry into the deals.
The MP seeks to be informed, through the Energy Committee of the National Assembly, on the rate at which KenGen supplies electric power to Kenya Power.
The ministry is also expected to explain the rate which Kenya Power procures electric power from Independent Power Producers.
Duale further wants explanation on what forms the basis for the huge difference between the rate charged by KenGen and the rate charged by IPPs.
The lawmaker also wants the ministry to disclose details of all Independent Power Producers, their stakeholders, directors and addresses.
Also needed is information of the total amount of money paid to the producers by Kenya Power and the Energy ministry for the period of their respective contracts with the government.
Duale also wants Kenyans told what “urgent measures Kenya Power is taking to reduce the cost of electricity to households, businesses, factories and other consumers.”
The debilitating costs are said to have hurt the President Uhuru Kenyatta administration’s Big Four agenda of enhancing manufacturing.
On March 16, MPs at the Energy committee said they want CS Charles Keter forced to appear before them to answer to queries, among them the agreements with IPPs. BY THE STAR