Spanish company in botched vitality tender prices taxpayers Sh3.2bn

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Economic system

Monday August 09 2021

vitality

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By EDWIN MUTAI

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Abstract

  • Taxpayers misplaced Sh3.2 billion in changing a contractor to construct the transmission vitality line linking a 310-megawatt wind vitality plant in Marsabit to the nationwide grid after the preliminary Madrid-based builder went bankrupt.
  • The Explain former Sh22.09 billion to entire the mission below a brand recent Chinese contractor, upping the bill from the preliminary Sh18.92 billion, a brand recent file from Auditor Customary shows.
  • Taxpayers forked out Sh11 billion to entire works left by Isolux Ingenieria SA, a Spanish company that had been contracted to construct the 428-kilometre vitality line.

Taxpayers misplaced Sh3.2 billion in changing a contractor to construct the transmission vitality line linking a 310-megawatt wind vitality plant in Marsabit to the nationwide grid after the preliminary Madrid-based builder went bankrupt.

The Explain former Sh22.09 billion to entire the mission below a brand recent Chinese contractor, upping the bill from the preliminary Sh18.92 billion, a brand recent file from Auditor Customary shows.

Taxpayers forked out Sh11 billion to entire works left by Isolux Ingenieria SA, a Spanish company that had been contracted to construct the 428-kilometre vitality line.

The Spanish contractor went bankrupt over Sh153.6 billion debt, slowing down monitoring of the native subcontractors and suppliers of materials.

“As at the time of termination of the contract, the Kenya Electrical energy Transmission Firm (Ketraco) confirmed that a filled with Sh10.83 billion had been paid to M/ Isolux Ingenieria SA,” said Auditor-Customary Nancy Gathungu.

In a special audit, Ms Gathungu said the termination of the contract between the Ketraco and Isolux resulted in a extra rate of Sh3,1739,062,348 to finalise the vogue of the transmission line.

This represented a 17 percent variation over the customary rate of Sh18.92 billion.

Ketraco terminated the Isolux contract in 2017 after the Spanish contractor became once declared bankrupt and placed below receivership over debt and liquidity challenges.

The Ketraco then employed a consortium of Chinese corporations to entire the transmission line linking Lake Turkana Wind Energy to the nationwide grid.

The corporations, NARI Neighborhood Corporation and Energy China Guizhou Engineering Firm took up the stalled works and finished the the same in 2018 at a full rate of Sh11 billion.

The Explain company has since paid NARI Neighborhood Corporation and Energy China Guizhou Engineering Firm Sh9.5 billion leaving a steadiness of Sh1.79 billion.

“The management of Ketraco ought to establish any pending duties plus accrued penalties thereof from both celebration with the consortium team so that the the same could per chance even moreover be settled in a timely manner. It will mitigate in opposition to future litigation risks and loss of public funds,” said Ms Gathungu.

The 428-kilometre vitality line is now being former to evacuate the wind electricity from the northern town of Marsabit to the Suswa substation in Narok, the nation’s well-known interchange for vitality from completely different sources.

Failure to glue the wind farm to the nationwide grid had left the developers stranded with vitality, amid pressing cash desires equivalent to loans compensation.

The Lake Turkana Wind Energy developers fined Kenya Sh18.5 billion for the delays in polishing off the high-voltage line (400 kilovolts).

The authorities has since cleared fee of Sh10 billion to Lake Turkana leaving a steadiness of Sh9 billion that the house owners will enhance by Could per chance honest 2024 via elevated vitality tariffs.

Constructing of the vitality line started in November 2015, nonetheless landowners’ compensation requires and the 2016 termination of the Isolux contract delayed it.

The wind farm, the final observe in Africa, with a capability of 310 megawatts — enough to vitality up to 1 million properties — became once supposed to inject the principle 50 megawatts into the grid in October 2016 and the final capability by July 2017.

In the special audit, Ms Gathungu has referred to as for extra investigations to salvage out any acts of an anomaly on people inviting in regards to the final assignment of the mission and motion taken on these found culpable.

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