According to the KPLC audit report, the total amount paid out by KPLC to KenGen was Kes 38.9 billion, which translates to 41% of the cost of purchasing power compared to the cost of purchasing power from independent power producers (IPPs), who received Kes 56.2 billion (59%). The difference translates to KES 17.3 billion, which brought a heated discussion during the grilling of IPPs by a parliamentary committee. The report showed that Kenya Electricity Generating Company (KenGen) supplied 63% of the electricity supplied to KPLC, for a total of 7,911 Gigawatt-hours, while the IPPs supplied only 37% (4,742 Gigawatt-Hours).
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The parliamentary committee linked the high cost of electricity to the high cost of electricity from independent power producers. Embakasi South MP questioned the move by KPLC to pay IPPs double the price of electricity paid to KenGen, yet KenGen produces twice the amount produced by IPPs. “KPLC could have saved Kes 17.3 billion of taxpayer’s money if only it utilized maximumly the capacity of electricity produced by KenGen, the member of parliament added.
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During another parliamentary meeting held in May 2023, the members of parliament argued that the agreements made between the independent power producers and KPLC should be made public to enable proper scrutiny. The burden of the high cost of electricity from the IPPs is bear by Kenyans through high prices of electricity. The cost of electricity has seen most investors relocate to other countries, which has highly affected foreign direct investments in the country.
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The audit report produced by the KPLC revealed that it costs KPLC an average of 3.93 cents per Kilowatt-hour of power purchased from KenGen, while it costs the company an average of 11.87 cents per Kilowatt-hour of power from IPPs. KPLC entered into expensive contracts with four independent power companies, which were being scrutinized by the parliamentary committee. Out of the four IPPs, Gulf Power Company, Iber Africa, and Thika Power agreed to consider amending their agreements with KPLC in order to bring down the cost of electricity supplied to the company.
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