EACC recommends prosecution of suspects behind Ksh.18.4B payment to Lake Turkana Wind Power

The Ethics and Anti-Corruption Commission (EACC) has recommended formal prosecution of suspects behind irregular payment of Ksh.18.4 billion to Lake Turkana Wind Power Ltd by various government agencies.

Document seen by Citizen Digital indicate that the payment was processed between 2005 and 2019.

EACC commenced the investigations after it received a report from the Public Investment Committee (PIC) of the National Assembly on procurement irregularities, contract mismanagement and fraudulent payments touching on the contract for the construction of 400KV Transmission Interconnector power line from Loiyangalani to Suswa and related works.

Investigations established that the contract between Kenya Power and Lighting Co. Ltd (KPLC) and Isolux Inginieria  S.A. (Isolux), resulted in a loss of Ksh.18 billion and increased electricity tariffs.

It was also revealed that in 2005, Lake Turkana Wind Power (LTWP) Ltd, leased 150,000 acres of land to put up a wind power generation plant.

In 2006, the firm carried out a feasibility study in Loiyangalani and established that the area had a potential for production of renewable energy. The company then proposed a wind power generation plant to the Government of Kenya (GOK), who took up the proposal.

“KPLC entered into a Power Purchase Agreement (PPA) with LTWP Ltd on 29th January 2010 for the development of the Wind Power Plant (the LTWP Project). Among the terms of the PPA were that LTWP Ltd would generate 300MW of electricity, and that KPLC would be the sole taker (consumer) of that power. However, a 400 KV Transmission Inter-Connector Line (T.I. Line) needed to be constructed from Loiyangalani to Suswa Sub-Stations, so that this generated power could be transported to the National Grid in Suswa Sub-Station," a source at the commission told Citizen Digital.

"Further that, if LTWP Ltd finished developing the Power Plant and started generating power, they would start charging for the power, whether KPLC were evacuating that power or not, from the date of commissioning. The T.I. Line was to be constructed by Kenya Transmission Company (KETRACO) and LTWP Ltd."

The construction of the Transmission Inter-Connector Line was incomplete, and as a result, LTWP Ltd charged GoK Kshs. 18,499,082,672/- for the Deemed Generated Energy, payment that involved public officers in contractual fraud and money laundering.

A report was compiled and forwarded to the DPP on 5th June 2023 recommending that the suspects be charged with conspiracy to commit an offence of economic crime contrary to Section 47A(3).

The suspects will also face 15 counts of abuse of office contrary to Section 46, conflict of interest Contrary to Section 42(3), two counts of willful failure to comply with the law relating to procurement Contrary to Section 45(2) (b), deceiving Principal contrary to Section 41 (2).

Other offences include fraudulent acquisition Contrary to Section 45(1)(a) all as read with Section48 of ACECA, three counts of Money Laundering contrary to Section 3, six counts of Acquisition of Proceeds of Crime contrary to Section 4 both as read with Section 16 of the Proceeds of Crime and Anti-Money Laundering Act 2009 and Neglect of official duty contrary to Section 128 as read with Section 36 of the Penal Code,

In its second quarterly report covering the period 1st April, 2023 to 30th June, 2023, EACC investigated and proposed prosecution for a total of 17 out of 22 files presented.

EACC is now awaiting response from the Office of the Director of Public Prosecutions for further action.