The national treasury has been questioned by a committee of Parliament over Kshs 9.9 billion loan purportedly borrowed on behalf of Kenya Power and Lighting Company.
A report by the Debt and Privatisation Committee claimed that although the debt is marked as guaranteed to KPLC, the power provider is not aware of its existence.
Led by Balambala MP Abdi Omar, the committee has requested the Auditor-General’s office to audit the disputed debt.
“That the Office of the Auditor General expedites the audit of project loans under the water sector and the Sh9.9billion loan borrowed on behalf of KPLC and submits a report to the House within the next two months” a recommendation in the committee report reads in part.
Read: Kenya Inks Kshs 407 Billion Loan from African Export-Import Bank
KPLC holds a series of debt facilities including those by international development partners. A huge debt burden has however meant that the utility has over the years been unable to service the dues without the help of the government which guarantees some of the loans.
The company’s latest annual report shows that repayments on borrowings by the utility dropped to Kshs 15.1 billion in the financial year ended June 2022 from Kshs 21.3 billion a year earlier even as repayment of the previous year’s accrued interest jumped to Kshs 5.9 billion from Kshs 4.2 billion.
Total debt by Kenya Power stood at Kshs 103.8 billion by the close of the June 2022 financial year, marking a slight drop from Kshs 105.97 billion the previous year.
The report further showed that the utility firm’s commercial borrowings stood at Kshs 39.7 billion at the end of June last year from Kshs 48.0 billion a year earlier, including facilities from Standard Chartered, Equity Bank, NCBA, and South Africa’s Rand Merchant Bank.
The utility firm is set for an impending Kshs 40.9 billion World Bank loan to help boost its operations and improve the supply of electricity at the grassroots through the Last Mile Connectivity programme.
Read: World Bank to Aid KPLC’s Last Mile Connectivity Programme With Kshs 40.8 Billion
The debt through the International Development Association (IDA), which is a member of the World Bank Group, will support Kenya’s goals of achieving universal access to electricity and clean energy by 2030 through a multi-phase programmatic approach (MPA) that allows flexibility in the application of a variety of financing instruments.
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