This archive report was first published on 1 September 2019.
Kenya Power, the electricity distribution monopoly, has been facing financial challenges after breaching the terms of its Sh59.6 billion loans.
Despite this, the company has defended its decision to acquire 64 new vehicles at a cost of Sh380 million, saying they are necessary for its operations.
According to Kenya Power acting chief executive Jared Othieno, the vehicles are being procured on an outright purchase basis due to their technical specifications and customisation requirements.
"The 64 vehicles budgeted for will be procured on outright purchase basis due to the technical specifications' and customisation required. All requisite justifications and approvals from the government were sought before the procurement process," Othieno said.
The new vehicles will be deployed across the country to support Kenya Power's newly launched 148 feeder-based units operating model, which decentralises services.
"An efficient fleet allows us to secure revenues by facilitating swift response in the event of network challenges. In this particular tender, we are procuring 64 Four Wheel Drive specialty vehicles among other units for deployment in our operations and maintenance divisions," Othieno said.
The company has been seeking to secure fresh short-term loans to refinance similar debts on a longer tenor.
"The ongoing procurement has been properly budgeted for and will not in any way strain our financial position," Othieno said.
Kenya Power's revenue rose by 4.23 percent to Sh125.8 billion in the period, but power purchase costs increased by Sh2.59 billion to Sh52.79 billion.
