KenGen six-month’s profit flat at Sh3.3 billion on rising costs
A Kes3 billion surge in operating costs at KenGen has seen the energy producer’s six month’s profit for the period ending December 31 remain flat at Kes3.3 billion.
KenGen’s operating costs increased to Kes18.1 billion from Kes15.6 billion on account of jump in depreciation expenses following revaluation of assets, higher insurance premiums as well as costs incurred in the commissioning of Olkaria I unit 6.
According to the company disclosures, Kenya’s peak demand for energy went up by 5.6 percent to 2,149MW from 2,036MW largely on account of additional 86MW from KenGen’s Olkaria I unit 6 as well as enhanced energy offtake network.
“This addition was critical in securing the national power supply when our hydro generation was dimmed due to the prolonged drought,” said KenGen.
The government may be forced to close down some of the power production lines at Masinga Hydropower station following a huge drop in water volume in the reservoir. “If it doesn’t rain we may close down the dam due to low water level,” Energy Cabinet Secretary Davis Chirchir said early February he toured Kamburu Hydropower station, one of the Seven Forks dams in Embu County.
In the half, KenGen’s revenue edged up by 11 percent to Kes27 billion from Kes24 billion attributable to additional output from increasing geothermal capacity of the company.
“We are on track to rehabilitate the 40-year-old 45 MW Olkaria I geothermal power plant, giving it a new lease of life and increasing its capacity to 63MW. We are upgrading Olkaria I aditional units 4 and 5 Olkaria IV, increasing their combined capacity by 40MW from 300MW to 340MW,” KenGen noted in a statement accompanying the results.
This week, the Cabinet has approved the implementation of the 40MW Olkaria I additional Unit 4 and 5 as well as Olkaria IV Unit 1 and 2 in line with Kenya’s push to realize energy security.
In the period, the board did not declare interim dividend.
Meanwhile, KenGen Board has appointed lawyer Julius Migos Ogamba as the chairman of the company. He will be taking over from General (Rtd) Samson Mwathethe, who has been at the helm of the firm since November 2020.