Why cartels are resisting change of guard at geothermal firm
A geothermal well at the floor of Menengai Crater. Industry insiders say President Kenyatta's shake-up of the GDC board has triggered alarm in energy circles. PHOTO | FILE
What you need to know:
Kenyans could enjoy cheaper power soon if Uhuru’s reform plan goes through, but fights over tender rigging and business and political rivalries are a huge obstacle
An attempt by President Uhuru Kenyatta to tackle the cartels blamed for holding back the development of geothermal power in the country has met powerful opposition.
An attempt by President Uhuru Kenyatta to tackle the cartels blamed for holding back the development of geothermal power in the country has met powerful opposition.
The reaction highlights the challenges of reforming the country’s parastatals that control billions of shillings in annual budgets.
Alarmed by what were seen as runaway levels of corruption at the Geothermal Development Corporation, and the capture of the institution by powerful political forces, Mr Kenyatta appointed a new board in changes announced earlier this month.
Industry insiders say the shake-up in the board, which saw business figures with interests in key corporation decisions replaced in large part by professionals, has triggered alarm in energy circles.
The stakes are high for a number of reasons. As highlighted in heated discussions on blogs over the past week, Kenyans could enjoy much cheaper power if authorities went full steam ahead with development of the country’s geothermal capacity that offers a much cheaper alternative to other sources of power.
But tender-rigging, struggles for business opportunities and political interests have been blamed for frustrating this potential.
The changes brought in lawyer Gershom Otachi as chairman. Other board members are Mr Salaton Letaipan, Mr Michael Ogwapit, Dr Stephen Njiru and Ms Florence Chepngetich.
He was replaced in an acting capacity by Mr Godwin Mwawongo, a reservoir/mechanical engineer with a postgraduate qualification in geothermal energy technology from the Geothermal Institute in New Zealand.
The changes have triggered a blowback from various quarters, with some objections being raised to the clear-out at GDC being seen as bordering on the comical.
Some of the strongest resistance has been witnessed in Nakuru where one MP—who is said to have a strong interest in a 105-megawatt geothermal project at Menengai—is reported to have worked with members of the economic old guard to organise hundreds of placard-waving youth to demonstrate against the appointments.
They claimed the appointments to the national institution were unfair because nobody from Nakuru was chosen. The matter has since moved to court; a judge declined to issue interim orders barring the new board from taking office.
The demonstrations point to the high stakes involved in the attempted move by State House to accelerate development of geothermal power and tackle the major cartels said to have held GDC hostage.
An insider who declined to be named discussing company affairs said the new appointments had triggered alarm among those who had enjoyed the inside track to major tenders and among former members of the company’s executive.
“In the past, key positions such as the chair have gone either to a home boy from the president’s community, a well-connected businessman or a powerful political figure. The fact that the new board does not comprise these categories, but at the same time involves people who have the direct ear of the President, has sent shivers down the spines of cartels.”
Chairman Otachi served as one of the lawyers in President Kenyatta’s case at the International Criminal Court (ICC), which has been dropped.
