KenGen eyes Kipevu power output
KenGen managing director, Mr Eddy Njoroge (left), and other officials launch the infrastructure bond. Photo/FILE
Kenya Electricity Generating Company - KenGen on Tuesday signed the contract for the construction of the 120MW Kipevu III power plant.
This follows the dismissal on Friday last week of an appeal filed by Man Diesel to the Public Procurement Appeals Review Board challenging the tender award to another firm.
In a statement on Tuesday, KenGen MD Eddy Njoroge said that the project would still meet its due date of December 2010.
“This project will help us stabilise the power situation in Kenya before we start implementing our plans to add 1,500 MW of capacity from 2013, primarily through geothermal sources, which are reliable and renewable,” said Mr Njoroge.
The Kipevu III project is one of those being financed using the proceeds of the Sh25 billion Public Infrastructure Bond issued recently by the electricity generator.
The bond, to be listed on Thursday, may ran into financial problems after a Germany based company moved to stop the power firm from constructing one of the key projects to be financed by the money.
KenGen will use the revenue generated from sale of power from the projects to pay interest and repay the Sh25 billion it borrowed from the public.
It is to start paying the 12.5 per cent interest on April 30, 2010 and repaying the loan on April 30, 2012 after it secured a grace period of two years.
In dismissing the appeal, the board noted that Man Diesel did not submit a valid bid bond for the tender and omitted to tender for a substantial part of the works.
