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{
    "id": 1378845,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1378845/?format=api",
    "text_counter": 118,
    "type": "speech",
    "speaker_name": "Sen. Sifuna",
    "speaker_title": "",
    "speaker": {
        "id": 13599,
        "legal_name": "Sifuna Edwin Watenya",
        "slug": "sifuna-edwin-watenya"
    },
    "content": "time to renegotiate some of the PPAs. I will be happy to disclose to you that many of those Independent Power Producers (IPPs) are not averse to those re negotiations. We do understand the contractual obligations that we got ourselves into are a bit restrictive in terms of what we can do and how far we can go. However, I am happy to report to this House that, that is a conversation that all those IPPs are willing to have with us. Mr. Deputy Speaker, Sir, when we begun this conversation, we had one of the hustlers in my office purchase some units of electricity. At that time, they bought units of Kshs100. Out of the money that was paid, it is only Kshs49 that went to buying actual power. That tells you that Kshs51 or 51 per cent of the amount you spend on electricity goes to taxes and levies. That is where the conversation begun. Out of that Kshs100, Kshs49 is the amount that got this hustler 3.9 units of electricity. This is back in 2022 when VAT accounted for Kshs12.2. The largest component of levies and taxes was that component of the Bill titled Fuel Energy Charge which at that time, was at a whooping Kshs28 out of Kshs100. That is where the focus of the Committee begun. We wanted to understand how we can reduce some of these charges. This is because in our minds, reducing some of those charges would directly result in the cost of electricity going down. You will see another item there being the forex charge which was at Kshs6 then. There was also a charge for Energy and Petroleum Regulatory Authority (EPRA) and Water Resource Authority then inflation adjustment of Kshs2.61. When we began this conversation, and I report to this House that if you want to know that the energy sector took note of this particular inquiry, after our inquiry begun, KPC stopped publishing the bills in the broken-down version that we used to receive because then it was easy for Kenyans to focus on where the pinpoints are. Many of my colleagues have spoken to the issues we engaged with. First, I would like to start with the question of transparency. The spectre of IPPs came about in the late 2000’s and early 2010’s following the drought that we had that resulted in electricity shortage. The Government then decided that in order to ramp up our capacity, we need to open up this particular industry to the private sector for us to have other generators coming on board. What we experienced is that the suspicion is there. I repeat it is a suspicion that most of these companies are owned beneficially by people who were then in the Ministry at that particular moment in time. They cut themselves some very sweet deals; some lasting 20 to 30 years and it is very difficult for us to wriggle out of them. The most interesting thing, I give the example of all the IPPs we spoke to. If you look at Page 11 of the Report, there is a company called Triumph Power. Triumph Power is the only one of those IPPs who appeared before us that is fully owned by Kenyans and their names are known. It is also not a coincidence that because they are the only ones who are fully owned by Kenyans and their identities are known, that they are the least dispatched company on our grid. That means they are the ones whom KPC buys the least power from. The Report tells us that the dispatch is at 5 per cent of their generation capacity. When you look at those two factors, you will know that transparency is a critical issue in our energy sector. The electronic version of the Senate Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Director, Hansard and AudioServices, Senate."
}