Ministry of Energy and Kenya Power are being sought by Auditor General Nancy Gathungu to be held accountable for a Sh 18.5bn wind farm bill.
In a special audit report on the projected which was tabled to Parliament on August 5, the Auditor General says the two parties did not ensure a competitive process in picking a contractor for the construction of a transmission line connecting the project with the national grid.
The Ministry of Energy granted the Lake Turkana Wind Power (LTWP) Limited, a private entity, the exclusive rights to survey the project area and wind resources and to further invite tenders on behalf of Kenya Power.
The action has been established to be contravention of the now repealed Public Procurement and Disposal Act of 2005 with the Energy Ministry further failing to justify the criteria for direct procurement.
Conflict of interest
The Auditor General Report also flagged conflict of interest given the contracted M/s Isolux Ingenieria SA is affiliated to LTWP. LTWP Limited is the proprietor of the wind power farm located in Loiyangalani and holds a private power purchase agreement (PPA) to sell generated electricity to Kenya Power over a 20-year period.
The terms of the PPA require Kenya Power to pay for power from the plant irrespective of whether the output makes its way to the national grid.
The new transmission line connecting the plant to the grid was completed in September 24,2018, 21 months after the completion of the wind farm resulting in the accrued Sh.18.5 billion bill in deemed generated energy (DGE) payments to LTWP. The Auditor General has queried the legitimacy of the charges given LTWP direct involvement in the procurement of the transmission lineโs contractor.
โM/s Isolux Ingenieria SA and the consultant KEMA, both who has been procured by LTWP Ltd were the key players in determining the success of the transmission line, yet LTWP Ltd was the eventual beneficiary of the delays in the completion of the project by way of the transmission line (TI) interruption DGE payments,โ read part of the special audit.
