The new CEO of the State-controlled utility, Kenya Power, Joseph Siror, is making the right noises about retiring diesel generators from the system. We need protection from the tyranny of diesel power plants. Cheap power to the people must be our clarion call.
A professed and devout born-again Christian, Dr Siror's biggest challenge will be how to inject the Christian ethos of probity and integrity into the running of a company that is so critical to the efficient functioning of the economy.
Will he maintain the momentum of the fight against corruption and reform at Kenya Power that started in earnest nearly one year ago with the launch of thoroughgoing forensic audits on the company's critical operations and systems?
Will Kenya Power manage to successfully deliver internationally competitive tenders to procure quality and world-class transformers, meters and cables? Dr Siror has been thrust into the middle of a battle with a group of politically-influential suppliers of meters and transformers that have dominated the supply of these critical inputs for more than 10 years.
Indeed, one of the main reasons this critically-important national utility fell into financial dire straits is long-standing vulnerabilities in the supply chains of meters, transformers and poles.
Kenya Power lost control of the supply chain of meters. An internal audit conducted in July last 2021 could not even reconcile rudimentary data on the number of meters purchased, the number of installed meters that were not vending and the meters that were recorded as faulty.
Many former Kenya Power staffers who had been engaged by the company as contractors were found to be holding huge stockpiles of pre-paid meters, which they were selling directly to post-paid customers.
This messy situation spawned a bigger problem-namely, excessive buying of meters. Many pre-paid meters could not be found in locations where they were validated within the enterprise resource planning (ERP) system, while illegal connections were found to have genuine Kenya Power meters that had been validated in the company's ERP system.
Early last year, the company, invoking a recent upsurge in failure rates of meters and transformers, introduced stricter technical specifications on quality standards.
Suppliers had to be judged on stricter criteria such as the number of years in the meter assembly business and disclosures on relationships with original equipment manufacturers. Suppliers with local shareholders were also required to disclose beneficial owners of the companies.
The conditions precipitated a protracted legal tug-of-war with the suppliers arguing that the new terms aimed to knock out local firms.
The suppliers grouped under a formal cartel by the name, of Energy Meters and Assemblers Association to oppose Kenya Power because the decision to open the tender to international players was against the Buy Kenya Build Kenya Policy.
Kenya Power won all the court cases against these powerful merchants to the Court of Appeal. With the advent of the administration of President William Ruto, the cartel's political clout and fortunes improved significantly.
In a letter dated December 7, 2022, Energy Cabinet secretary Davis Chirchir, wrote to the company to review its tendering system, qualifications and specifications to accommodate local manufacturers of meters and other equipment.
Kenya Power responded as per the minister's instructions by floating a multi-billion-shilling tender in which only local manufacturers were allowed to participate. On May, 2, the company issued a notification to award contracts where quantities were divided equally between members of the Energy Meters Association. Some public-spirited members of the public have gone to court to challenge the awards.
This is the backdrop against which Dr Siror has entered the fray. He should not allow merchants to dump meters that have been found to have high failure rates on us in the name of 'Buy Kenya, Build Kenya'.
In purchasing meters, Kenya Power must not compromise on quality and global standards. It's the electricity consumer who ends up paying for this difference.
Dr Siror must be well aware that for any utility, that little gadget called a meter is its cash register. All revenues it collects can only be collected through the device. You lose control of the supply chains of this critical product and you are doomed to economic stagnation and persistent unprofitability.
When you are negotiating with suppliers of meters, the things you must insist on must include quality, global standards, failure rates and accuracy.
In getting to the bottom of Kenya Power's problems, the game-changer will be the eagerly-awaited results of the forensic audits on the company's operations and systems that were being conducted by the Auditor-General. We want answers to many questions.
Is it the case that we have the fourth-highest transformer failures in the world? Why are incidents where electricity poles are falling and killing innocent people becoming frequent? Is the firm buying good-quality poles?
