Kenya Power cripples Mumias Sugar - Daily Nation

Kenya Power cuts electricity supply to Mumias Sugar

Sunday September 9 2018

Mumias sugar factory

An engineer at work at Mumias Sugar. The troubled miller was planning to start ethanol production on September 10, 2018. PHOTO | FILE | NATION MEDIA GROUP 

By BENSON AMADALA
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Kenya Power has cut electricity supply to troubled Mumias Sugar Company— triggering a fresh crisis as miller was finalising preparations to start ethanol production.

The miller is reported to be owing Kenya Power nearly Sh2 billion in unpaid bills.

ETHANOL

Last month, Mumias managers held talks with the power supplier on their plans to settle the debt after resuming cane crushing.

Kenya Power Kakamega County Business Manager Eunice Masese on Sunday told the Nation that the decision to disconnect electricity was made by top in Nairobi.

“This matter is being handled by senior management officials at Kenya Power headquarters,” she said.

“We were instructed to disconnect the power supply because of the unpaid bill.”

Mumias acting CEO Patrick Chebosi said the power supply was disconnected as they prepared to start producing ethanol on Monday.

Kenya Power workers are reported to have gone to the factory on Saturday evening and switched off electricity supply, disrupting operations.

“We were set to start processing ethanol production when the electricity supply was switched off,” said Mr Chebosi.

“We had already fermented the materials in preparation for the processing but could suffer loses if the matter is not resolved.”

AUCTION

He said they would buy diesel to run generators and power the factory for the processing of molasses to begin.

The miller managed to collect 800 tonnes of molasses for ethanol production at the factory.

This is the second time the power firm has disconnected electricity to the factory located in Kakamega County.

Mr Chebosi was on Sunday making frantic efforts to ensure production of ethanol goes on as earlier planned.

On Friday, the miller’s woes deepened after its managers were served with a notice from auctioneers demanding Sh13.4 million awarded to a former employee by a court in Kisumu.

The money was awarded to a former senior manager, Ms Pamela Lutta, who sued for wrongful termination.

Ms Luttah worked at Mumias as director of marketing and corporate affairs before rising to become the head of commercial sales in 2014.

SH20BN DEBT

She was dismissed the following year. 

The management now fears that should the auction take place, it would encourage other creditors demanding more than Sh20 billion to go for the miller’s assets.

Mr Chebosi said revenue generated from the sale of the ethanol would be used to pay farmers who would deliver cane once milling resumes.

“But our efforts to get back on track are being frustrated by even our own employees, making it difficult to resume milling,” he said.

“We will, however, continue engaging with farmers and other key partners to try and resume milling.”