STALEMATE

Kenya Power defends Sh6 billion tenders

This is in the construction of power substations and power lines in the Western region and Mombasa, bids that were floated in August 20, last year.

In Summary

•A section of contractors, under the Energy Sector Contractors Association (ESCA), moved to the Public Procurement Administrative Review Board(PPARB), seeking to stop the tenders.

•The contractors alleged the tender was discriminatory towards Kenyan owned firms and that it favours foreign companies.

Kenya Power Company workers at a power substation in Kisumu
Kenya Power Company workers at a power substation in Kisumu
Image: MAURICE ALAL

Kenya Power has fended off accusations by local contractors that they have been locked out of a Sh6 billion work of tenders.

The power retailer said the construction of power substations and power lines in the Western region and Mombasa  floated in August 20 last year is donor funded and comes with conditions.

The tenders involve the design, supply , installation and commissioning of 85-kilometre of 132 kilovolts double circuit Narok-Bomet line and two takeoff bays at both Narok and Bomet substations.

In Mombasa, Kenya power is seeking to put up a 132kV (Kipevu-Mbaraki) line and a substation, projects being developed using a credit line from Agencies Francaise de Development(AFD).

A section of contractors, under the Energy Sector Contractors Association (ESCA), moved to the Public Procurement Administrative Review Board(PPARB), seeking to stop the tenders.

In official communication between it, ESCA and PPARB, seen by the Star, Kenya Power defends the process as above board having followed the financier's guidelines.

“This is an AFD financed project whose procurement is based on the financier's procurement guidelines. The bidding document took into account the law, KPLC requirements as well as the AFD procurement guidelines,” Kenya Power states.

The power firm said it is required to commit to financing agreements where in most cases, contracts are given to specific companies picked by the financier.

Most financiers prefer projects they have extended credit towards to be implemented by companies originating from their country.

Kenya Power has since said the tender was open to all interested bidders and there was no discrimination at all.

 
 
 

Neither AFD nor the KPLC had any bias towards any nationality,” it said, "The process is in compliance with relevant internationally recognised practices, particulalry those recommended by the Organization for Economic Cooperation and Development (OECD)."

Management yesterday declined to make ant further comments on the tender row. 

The tender was closed and bids opened on January 7, this year.

On the same date, KPLC which is headed by CEO Bernard Ngugi was served with a request for review that was submitted to Public Procurement Administrative review board by energy sector contractors.

The contractors alleged the tender was discriminatory towards Kenyan owned firms and that it favours foreign companies.

According to complaints by local contractors, the tender documents failed to promote the national values and principles under Article 10 of the Constitution.

The contracts are said to have “unrealistic turnover not feasible in the Kenyan Economy for citizen contractors.”

Kenya Power had specified a requirement limiting bidding to firms with an average turnover of Sh1.8 billion over the past five years.

Bidders must also have  successfully completed the construction of three sub-station extensions and at least 50 kilometres of 132kv double circuit line.

No Kenyan company has ever been awarded such projects, meaning they fell short of the requirements.

However ESCA argues that the requirements are deliberately skewed to lock out local bidders.

The association has asked the Public Procurement Administrative Review Board to nullify the procurement process, a wish that has since been granted, with a hearing set for January 21.