Monopolistic Kenya Power seeks other revenue avenues

Kenya Power has once again shocked Kenyans after it announced plans to commercialize its garage and lease out idle land to boost the company’s electricity sales by increasing profit avenues. Though Mr. Ngugi did not give the exact monetary potential of the leasing and the garage, he believes that the number of vehicles on our roads makes the business likely to pick up and generate revenue for the electricity company.

“We have a transport section and we want to open that as a public garage since it is idle at the moment. We also want to lease out idle land,” said the CEO, Mr. Bernard Ngugi.

Kenyans could not, however, understand how a monopoly company like Kenya Power can be making a loss or eyeing to generate revenues from a different avenue when they already have the whole market to control. Kenya Power’s latest financial records for the year ended June 2019 released last week shows that the company’s profit dropped by 91.98 percent, from Sh3.27B in 2018 to Sh262M in 2019.

Kenya Power will lease the idle pieces of land it holds in Mombasa, Nakuru, Eldoret, Nairobi, and Nyeri. The firm’s board intends to expand its fiber business that was started 10 years ago. The fiber optic cable rides on the existing extensive power transmission and distribution lines across the country and the electricity company has been contracted by giant telecommunication operators in the country such as Safaricom, Airtel, Liquid Telecom Ltd, Jamii Telecommunications, Indigo Telecommunication Ltd and Wananchi Telecom Ltd to offer telecommunications network.

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“The fiber business gives an average of Sh500 million and we want to incrementally improve on this investment to increase leasing to the telcos. We still believe it is a lucrative business and we have started injecting in new capital,” MD Mr. Ngugi told the Nation.

The Kenyan government in 2018 ruled out plans to license new entrants in the electricity distribution and retail market. Kenya Power continues to enjoy a market dominance despite many cases of corruption, overcharging of its customers and recently the irregular KSH 4.5 Billion tendering scandal that led to the firing of its top executives including former CEO, Ken Tarus.

READ ALSO: No, Kenya Power is not stealing from you – it’s just but payback time

Enock Bett
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Enock Bett

Digital Media Enthusiast|Tech, Business, Corporate Affairs, Politics, and Governance. [No Modes] EMAIL: [email protected]

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