Kenya Power has announced that it will pay about $1.2 million (Sh140-million) in legal fees linked to the renegotiation of power purchase agreements (PPAs) signed with electricity-generating companies.
The electricity distributor revealed the award of the legal tender to two firms in regulatory disclosures. A joint venture comprising British lawyer and energy dispute-focused practitioner Michael Sullivan will earn Sh123.97-million ($1.1-million). Nairobi law firm NBMA Advocates will score Sh16.77-million ($144 506,68).
Kenya Power’s decision to seek the services of the legal experts comes after President Uhuru Kenyatta appointed a task force to review PPAs signed between Kenya Power and all electricity generators in March 2021, with a goal of renegotiating the energy prices and other terms downwards.
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In February 2021, the Ministry of Energy asked independent power producers (IPPs) who sell power to Kenya Power to lower tariffs imposed on the national power distributor. This came after opposition from the foreign firms.
The utility’s goal is to lower Kenya Power’s costs and offer the utility headroom to cut retail tariffs by an additional 15 percent without falling into losses. It already cut retail tariffs by 15 percent in January, trying to meet the plan to lower system losses halfway.
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The task force that was dispatched by Kenyatta found that there was a significant difference between the tariffs charged by the main power producer KenGen and IPPs.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry