Kenya Power has given in on the battle with local manufacturers over supply deals for smart meters, a move that will see a number of local firms rake in millions of shillings from the power distributor.
The State-owned power utility last week issued a tender notice for the supply of smart meters in a deal that will be restricted to an undisclosed number of local manufacturers. Kenya Power has since last year been embroiled in court battles with local manufacturers who had gone to a tribunal and later the High Court to block a Sh2 billion tender for the supply of single-phase, three-phase postpaid and prepaid meters.
The tender comes amid a supply hitch for meters that has forced Kenya Power to delay fresh connections to millions of customers, ultimately hurting efforts to grow its sales besides fueling outrage from customers.
“Kenya Power & Lighting Company PLC intends to procure the following through Restricted Tender Procurement of Single Phase Prepaid Meters,” the State power distributor says in the notice. “The tender document shall be published on 08.02.2023 to a limited number of Local manufacturers.”
Kenya Power management had not responded to Business Daily queries on whether the fight from local manufacturers last year prompted the restriction of the tender to Kenyan firms.
The deal that is set to lift local firms comes more than seven months after manufacturers protested one of the tender restrictions that required successful bidders to have a minimum of 15 years of technical specifications experience in the manufacture of energy meters.
Smart Meters Technology Ltd, Shenzhen Star Instrument Company Ltd, Magnate Ventures Ltd and Inhemeter Africa Company Ltd last year went to the Public Procurement Administrative Review Board (PPARB) to block the tender on grounds that it unfairly locked them out.
The firms argued that the requirement for successful bidders to have a minimum of 15 years of technical experience was unlawful and discriminatory yet they have invested heavily and have been supplying to KPLC since 2015. But PPARB dismissed the petition saying it was time-barred, prompting the firms to challenge the tender before the High Court.
Kenya Power had defended the requirement to restrict the tender to international firms arguing that there had been massive failures for locally assembled meters.
Documents filed before the High Court showed that none of the firms had been in existence for 15 years and thus automatically knocked them out of contention for the lucrative deal. Kenya Power has since last year been repairing meters in a bid to ease the crisis even as customer complaints mount over the delays.
The firm had 9.01 million customers as of December last year from 8.91 million in June, a paltry one percent rise reflecting how the meter shortage has hurt efforts to grow customers and sales. Kenya Power has however not made public the number of customers whose connections have been delayed due to the supply hitches for the meters.