How Sh1.5bn electricity bills left City Hall at the mercy of Kenya Power

Different county government installations and institutions have suffered power blackouts due to disputes arising from City Hall’s failure to pay the debt, now about Sh1.5 billion.

However, the latest power cut, which hit City Hall and City Hall Annex for over a week between October 21 and 28 was the most significant.

The result was no water in toilets and taps, grounded lifts and shut computers, security and electrical systems.

Kenya County Government Workers Union Nairobi branch secretary Festus Ngari detailed how the county government was paralysed because of the power cut.

He said the county’s backup generator only serves the county assembly and the governor’s wing.

“When lifts are not working, the physically challenged have a problem. Systems like computers and laptops go off. Whoever is using Wi-Fi to make or receive payments is also incapacitated,” Mr Ngari said.

“We had to close all the toilets because any toilets that rely on water pumps could not be used. The county told us the problem was due to disputed power bills.”
Kenya Power, for its part, said the county government has an old electricity debt that has ballooned to Sh1.5 billion.

Kenya Power restored the supply after the company and county officials drew up a payment plan.

“Following a series of meetings between Kenya Power and the county government of Nairobi, and thanks to government intervention, we have entered into a payment plan that will result in the debt being paid in full. In the interim, City Hall is back on supply,” Kenya Power corporate communications manager Ann Nderi told Nation.Africa.

She added that the utility provider has stepped up revenue collection so it can meet its network and service obligations.

“In the case of Nairobi City County, the debt owed to the company currently stands at Sh1.55 billion,” she said.

The two entities have been at loggerheads over debt arrears since 2014, with the county government claiming Kenya Power also owes it millions in wayleave and rent arrears.

Disconnecting electricity

The first outage played out in January 2015, when City Hall was plunged into darkness for three days.

In 2016, the utility firm threatened to cut off power to City Hall Annex, Mama Lucy Hospital, Pumwani Hospital, public primary and nursery schools and county depots, as well as supply to streetlights.

But City Hall went to court and obtained an order barring the State agency from proceeding with the plan as its case was heard.

The court order bought City Hall some time, but in June 2018, Kenya Power struck again, disconnecting power to City Hall and City Hall Annex for two days, after county officials lost the court battle to stop the agency from disconnecting electricity.

At the time, the accrued power bill was Sh990 million, which had accumulated since September 2016.

County officials, however, disputed the amount, saying they were only aware of Sh447 million. Kenya Power said the Sh447 million debt represented only debt accrued between September 1, 2016 and April 31, 2018.

The county secretary at the time, Peter Kariuki, nonetheless, termed the disconnection “an act of bad faith”, saying that the county and the electricity supplier had formed a joint task force to look into the exact debt owed on either side.

“We have responded by reminding them of the over Sh800 million they owe us in rates and wayleave charges for the company’s distribution network, with some of the debts outstanding since 1990, but as a gesture of good faith, we have offered to pay Sh15 million now and the balance in realistic instalments until the figure finally agreed upon is settled,” he said.

Back-and-forth

The Sh15 million payment bought City Hall some time.

But in November 2020, Kenya Power struck again, leaving City Hall in darkness for three days.

This disrupted operations in most county offices, with some being closed while staff and customers had to use the stairs to reach upper offices.

The two entities would try to negotiate a debt swap between the electricity bills and money owed in wayleave charges but nothing came of the negotiations.

In May this year, City Hall set aside Sh691 million to clear the electricity debt in a bid to end perennial power cuts.

The county argued that it owes the utility firm Sh691.58 million in electricity bills, according to the Nairobi County Debt Management Strategy Paper for the financial year ending on June 30, 2022.

The county said the allocation was intended to end the back-and-forth between City Hall and Kenya Power over debts owed to each other, with City Hall claiming the utility provider owes it Sh856 million in wayleave charges.

In June, Kenya Power struck again, cutting off electricity to City Hall and City Hall Annex after the county delayed releasing the allocated money.

The county government will now spend Sh13 million on another generator to light up City Hall and City Hall Annex when outages occur.