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The Kenya Electricity Transmission Company (Ketraco) is facing scrutiny over the transparency of its new power transmission projects. This development follows the recent cancellation of a significant deal and comes amidst calls for greater clarity on project specifics and safeguards.
New power transmission projects initiated by the Kenya Electricity Transmission Company (Ketraco) have ignited concerns regarding tendering transparency. Analysts suggest these developments could significantly influence public debate and policy implementation in the near term, with stakeholders advocating for clear communication on project timelines, costs, and protective measures.
The current concerns emerge months after the cancellation of a contentious $736 million (approximately KSh 94.9 billion) deal with India's Adani Group. This previous agreement, intended for electricity transmission infrastructure, faced legal challenges from a non-governmental organisation, the Commission for Human Rights and Justice (CHRJ), which cited a lack of transparency and public participation. The CHRJ had petitioned the High Court to halt the contracts, arguing that the public was entitled to information about the deal and that it should comply with the Public-Private Partnership Act and the Public Procurement and Asset Disposal Act of 2015.
Ketraco has previously sought private sector involvement in transmission line projects to address a significant financing gap, estimated at approximately USD 5 billion (KSh 650 billion), and to ensure timely infrastructure development. The company's Transmission Master Plan 2023-2042 outlines the need for 5,672 km of new high-voltage lines, requiring substantial investment.
Public procurement in Kenya is governed by the Public Procurement and Asset Disposal Act (PPADA) 2015, which aims to promote transparency, fairness, and accountability in the use of public funds. The Act outlines various procurement methods, including open tendering and restricted tendering, and sets out procedures for efficient public procurement. The Public Procurement Regulatory Authority (PPRA) is responsible for monitoring and reviewing the public procurement system to ensure compliance with national values and constitutional provisions, including Article 227 on public procurement.
Despite the existing legal framework, compliance within the energy sector has been noted as low in the past. Recommendations have been made for energy corporations to establish supplier appraisal audit policies and adopt ethical guidelines from the PPRA and the Kenya Institute of Supplies Management (KISM) to ensure adherence to the PPADA 2015.
Stakeholders are urging Ketraco to provide greater clarity on the new projects, specifically concerning timelines, costs, and safeguards. This call for transparency is crucial for public confidence and to ensure that public funds are utilised effectively. The need for enhanced transparency in the procurement process has been highlighted as a way to improve cost-competitiveness, encourage price reductions, and enhance public accountability and governance in the power sector.
In the past, Kenya Power, a key player in the energy sector, has faced criticism for a lack of public detail regarding how power purchase agreements (PPAs) were procured, their cost structures, and impacts on the broader power system. Reforms recommended for PPAs include competitive and transparent procurement processes, public notice of intent to sign agreements, and access to key details of the agreements during public comment periods.
Lack of transparency in tendering processes can lead to inflated project costs, compromised quality of infrastructure, and a reduction in public trust. For Ketraco, ongoing concerns about procurement could exacerbate existing financial pressures, including significant contingent liabilities from contractor disputes and legal battles over wayleave compensation. These financial strains could undermine the company's ability to deliver essential energy infrastructure and impact electricity connections across the country.
The specific details of the new power projects, including their scope, exact costs, and procurement methods, remain largely undisclosed to the public. The extent of public input sought by regulators for these projects is also unclear. The identities of the companies involved in the new tenders have not been publicly announced.
Observers will be closely watching for official statements from Ketraco and the Ministry of Energy regarding the new power projects. The level of detail provided on tendering processes, project costs, and timelines will be critical. Any efforts to enhance public participation and adherence to the Public Procurement and Asset Disposal Act 2015 will be key indicators of the government's commitment to transparency in the energy sector.
