Principal Secretary Julius Muia said the cash has been wired to the exchequer, more than a year and a half after the LTWP notified Kenya Power, the Ministry of Energy and the Treasury of the excess payment.
The lender rejected the refund for excess payment of idle power charges paid in 2018, citing a lack of sufficient details of the ultimate beneficiary of the millions of shillings paid to the CBK account.
The Treasury has finally received Sh785 million that had been rejected by Standard Chartered Bank #ticker:SCBK in Frankfurt, Germany, after Lake Turkana Wind Power (LTWP) refunded the cash for excess pay from Kenya Power.
Principal Secretary Julius Muia said the cash has been wired to the exchequer, more than a year and a half after the LTWP notified Kenya Power #ticker:KPLC , the Ministry of Energy and the Treasury of the excess payment.
The lender rejected the refund for excess payment of idle power charges paid in 2018, citing a lack of sufficient details of the ultimate beneficiary of the millions of shillings paid to the CBK account.
It also demanded supporting documents for the pay amid increased oversight by German financial regulator BaFin for money laundering breaches, which has seen lenders in the European country slapped with multibillion-shilling fines.
“The money was fully received in the government exchequer account. Why Kenya Power and the Ministry of Energy took long to recover the excess payments, I do not know,” Dr Muia said
The Marsabit-based power firm has since December been trying to refund the money to Kenya Power.
The Marsabit-based power firm says it transferred the cash to the Frankfurt account in December after Kenya Power provided the CBK bank details for the transfer.
But Standard Chartered Bank in Germany rejected the cash and returned it to LTWP account amid claims it failed to meet the customer due diligence requirements, terming the cash transfer suspicious.
The power firm tabled in Parliament a letter it sent to Kenya Power, capturing its frustrations over the Sh790 million refund that few government officials wanted to be associated with.
The electricity generator has since December 23 contacted Kenya Power three times and the CBK twice in search of the required documentation to support the transfer of the overpayment.
“To call a spade a spade, there was a failure on how quickly the correct account details should have been issued. We are considering what should be done administratively or otherwise,” Dr Muia said.
He told MPs that the Treasury needs time to inquire whether interest had been received from LTWP for keeping the Sh785 million for a year and a half.
MPs have questioned an overpayment of Sh785 million in 2020 to LTWP for energy not consumed by taxpayers.
The payment followed delays in the construction of the transmission station to evacuate power from the 40,000-acre Loyalangalani wind farm in Marsabit County to the national grid.
The investor received 45,197,003 Euros (Sh5.7 billion in 2021) when what was due to it was 39,023,703 Euros (Sh4.9 billion), hence the excess of 6,173,296 Euros (Sh785 million).
LTWP commissioned its 310 megawatts power plant on January 27, 2017, but the government, which built the evacuation line, did not complete the works until September 24, 2019.
