Kenya Power has begun a revision process of insurance policies for its staff and departments in a fresh bid to cut down on cost.
The move also targets the company’s insurance policies for its transformers and infrastructures.
According to Kenya Power, the review will go a long way to boost its cash flow following years of financial woos at the power distributor on the back of misappropriation of public funds.
Kenya power has already engaged with a technical adviser to help in implementing the restructuring and review plan.
“The Company wishes to undertake a comprehensive review of existing insurance arrangements and the staff medical scheme with a view to establishing a robust and responsive portfolio and to adopt a cost-effective framework for procurement of Insurance Service Providers and managing the medical scheme going forward,” Kenya Power said in the notice.
According to a Business Daily report, Kenya Power currently has no insurance cover for its 122 substations distributed across the country, exposing the strategic national assets, employees and the general public to major risks in case of accidents.
In November last year, Energy Principal Secretary Gordon Kihalangwa while appearing before Parliamentary Committee said that the utility could not afford the cover after bidders quoted the above available budget and could not be awarded pending availability of funds.
The current reforms at the energy distributor come at a time when a 15 percent energy consumption in the country has already been effected as directed by President Uhuru Kenyatta in October last year.
Data from the Kenya National Bureau of Statistics (KNBS) shows the cost of 50 units of electricity fell by 15.73 percent this month to Ksh.796.83 from Ksh.945.59 in December.
Commercial and industrial consumers whose consumption exceeds 15,000 units are now paying an energy charge of Ksh.8.70 and Ksh.4.35 per unit of supply metered during off-peak hours on top of a demand charge of Ksh.800 per kilovolt amps.
Electricity costs are set to come down further by 15 percent from ongoing negotiations between the government and independent power producers (IPPs).
In six months to June last year, however, Kenya Power and Lighting Company PLC (Kenya Power) bounced back to profitability when it posted a Ksh.8.2 billion pretax profit.
The positive results came at a time when the company, which enjoys a monopoly of power distribution in the country has been facing criticism over public funds mismanagement.
