Donors, boundary disputes delay Sh43bn last-mile electricity plan

By: VINCENT ACHUKA

The ambitious Sh43.1 billion project announced by President Kenyatta in May for cheap power connections is being delayed by boundary disputes and strict donor regulations that require double tender approval.

The last mile project was supposed to slash the cost of electricity connections to Sh15,000 and increase connectivity to 70 per cent countrywide by 2017, from the current 40 per cent.

But close to two months after the proposed roll-out of the first phase, only four contractors out of the expected 11 have been approved. Work on the ground is yet to start.

This is even as the French Development Agency (AfD) on Thursday agreed to advance the government Euros 90 million (Sh13.2 billion) for the third phase of the project, increasing the total budget to Sh56.2 billion.

Some Sh4.4 billion of the money advanced by AfD will be a grant. The World Bank is funding the second phase, to the tune of Sh15 billion.

FLEXIBLE PAYMENT

Under the scheme, applicants unable to pay the required Sh15,000 upfront will be connected for free and allowed to pay the money in installments as part of their monthly bills.

The Africa Development Bank (AfDB) in April loaned the government Sh28.1 billion for this phase, which is supposed to help Kenya Power connect 318,000 households or 1.5 million people living within 600 metres of designated transformers.

And on April 24, Kenya Power called for bids after announcing that 110 companies had applied. Six months later, the selection of contractors is yet to be completed.

“I know Kenyans are anxious on whether the project will be rolled out, but the procurement process is being done in conjunction with bilateral agencies and it has taken longer than expected,” Kenya Power managing drector Bernard Chumo told the Sunday Nation.

“Our timing was that, by September, we would have rolled out. But you know we are only implementers so the approved tenders will still have to get a No Objection Clearance from AfDB. Nevertheless, as the approvals come, we are releasing them,” he said.

POLITICAL CONSIDERATIONS

Politicians have also contributed to the delay, after they disputed the location of some of the 5,320 transformers that had been selected by Kenya Power.

“Constituency boundaries seem to have changed since some MPs say some of the transformers we had identified with their constituencies were in neighbouring areas. We had to redraft them,” said Dr Chumo.

The power distribution company had divided the country into 10 blocks.

Each was to be allocated a single contractor for the installation works.

The eleventh contractor is supposed to procure and install meters.

Companies that have so far been approved and are mobilising resources to start the project by the end of this month are Inlometre, E-trade and Angelique.

Inlometre will be incharge of meter installation for the whole of phase one, while the other two will install electricity in three blocks for the first lot of customers.

E-trade will connect Block 5, which comprises Nairobi and Kiambu counties.

It has also been approved to connect prospective customers in Block 10, which comprises Mandera, Marsabit, Moyale and Wajir.

Kenyans residing near the selected transformers in Block 9 are also among the lucky lot, as Angelique will connect Taita Taveta, Lamu, Kilifi and Kwale.

GOVERNMENT’S COMMITTMENT

Delays in implementing the project have raised questions on the Jubilee government’s commitment to lowering the cost of electricity, which has risen in recent months after a modest drop earlier. Lowering the cost of electricity was one of the election pledges made by the government, which has invested massively in geothermal power.

There has also been confusion on whether everyone is eligible to the low connection fee.

While launching the project in May, President Kenyatta said: “It is my government’s endeavour to ensure every Kenyan has access to power. Today I announce that, as a result of the programmes we have launched, we are reducing the cost of connection fees from the current Sh35,000 to Sh15,000”.

Meanwhile, figures by the power distributor indicate that 1,087,829 new customers have been connected to the grid since January using the Sh35,000 connection fee, bringing the total connections to 4,078,250.

But the company says it has been incurring losses from this low fee since the actual amount for a new connection is Sh100,000.

“For this reason, we have twice tried to increase the cost of electricity connection to Sh75,000 for those living within 600 metres of a transformer, but these plans were declined by both the Mwai Kibaki administration and the current government,” said Dr Chumo.

SOURCE: DAILY NATION