This archive report was first published on 30 October 2021.
Kenya Power, the state-owned electricity distributor, is facing a fresh debt relief plan proposed by a presidential task force. The plan involves delaying repayment of Ksh53.27 billion ($530 million) loans held by the company for two years.
The loans, which were tapped from the International Development Agency, China Exim Bank, and Japan Development Bank, are guaranteed by the state and are therefore payable by the government.
According to the task force, the moratorium will ease pressure on Kenya Power's finances, which have been struggling to meet debt repayments, especially those with one-year maturity.
China Exim Bank accounts for the biggest share of the on-lent loans at Ksh14 billion ($129m), followed by a Ksh13 billion ($130m) facility from IDA that was meant to fund the construction of a line to import power from Ethiopia.
Kenya Power has been in financial difficulties, with a preliminary audit report showing that the company held about Ksh9.8 billion ($98m) in deadstock, including items such as cables, meters, and transformers.
The task force has also recommended a forensic audit of procurement systems and stocks to weed out cartels that have over the years profiteered through fraudulent dealings with rogue employees.
Kenya Power has been in the spotlight amid financial haemorrhage largely linked to procurement scandals.
