By James Anyanzwa
Active Partners Group (K) Ltd, the local subsidiary of a Sudan-based multinational, has unveiled a major proposal to set up a $7million (Sh546 million) pre-payment meters assembling plant in Kenya.
The group’s functions are wide-ranging and include telecom, Information Technology, financial engineering, consultancy, civil and construction works and power and electricity. It hopes to use its local base as a springboard to penetrate regional markets.
The use of the meters is widely expected to reduce billing errors, which have often forced consumers to pay for power they have not used.
"Because of Kenya’s infrastructure, it is easier for us to be based in Kenya, manufacture and export in the region," Mr Mike Lucas, APG (K) office managing director, told the Financial Journal.
The firm, which is already supplying the devices to Southern Sudan, expects to expand its market reach to countries such as Tanzania, Uganda, Rwanda, Burundi and the Democratic Republic of Congo.
Employment creation
The company, however, says it will outsource its key assembling functions to local Jua Kali artisans so as to promote local employment creation.
The strategy will also help the firm tap into local talents whose welfare has been damaged by low incomes and increased cost of living.
The proposed plant is scheduled to begin operations in June.
"The Kenyan project is one we are closely looking at and in the middle of this year we should be in place," Lucas told FJ last week.
Electronic pre-payment meter. The use of the new gauges is expected to reduce billing errors, which have often forced consumers to pay for power they have not used. |
"The expansion will, however, depend on the demand for the gadgets," said Lucas
The Kenya Power Lighting Company (KPLC) immediately welcomed the new move after its attempts to offer similar devices dragged longer than expected.
"No doubt, a good move," commented Mr Migwi Theuri, KPLC’s deputy manager, Corporate Communications.
Slum areas
The power-distributing firm has already selected South Africa’s Actis Measurement and Systems (PTY) Ltd to design, supply, install, test and commission prepayment software, hardware and meters.
The firm was picked through a second tendering process in September 2008.
The pilot or phase one of the project is expected to commence in March 2009 with about 5,000 middle-income households in Nairobi and in some slum areas.
Six international companies had tendered for the supply of the gadgets and software in 2006 but KPLC withdrew the tender, citing the need to further evaluate its specifications for the metering equipment in view of the existing and emerging technologies in that area.
"It was necessary for us to further evaluate our specifications for the metering equipment and systems in view of the variety of existing and emerging technologies in that area," says Theuri.
The companies that bid included Saabgintec PTY Ltd, Landis Gyr, Krishna Enterprises UAE, Actaris Measurement Systems, Conolog SA and Chidhya K Ltd representing Insyte Instalaciones of Spain. While the KPLC has already started improving on its metering and billing process through an Automatic Meter Reading (AMR) system, progress on prepayment meters has been wanting.
After evaluating tenders for the pilot project in may 2006, KPLC planned for pilot project of about 5,000 customers whose existing meters will be replaced with those for pre-payment.
Embakasi Estate
Full implementation of 600,000 connections is to be done if the pilot project is successful.
Some of the areas earmarked to be covered by the pre-payment pilot project include seven middle-class estates in Nairobi, namely Fedha, Tassia, Imara Daima, Villa Franca, Avenue Park I & II, Nyayo Estate Embakasi and part of Donholm. KPLC has an estimated 750,000 consumers who will use the system on a gradual basis.
The metre system, which are widely used throughout the world, involve the use of smart cards loaded with the amount of credit purchased.
The card is inserted in the metres, allowing consumers to pay for the electricity as and when it is used.
Just like the prepaid mobile phone system, the prepaid electricity meter will switch off power immediately a consumer has exhausted his credit.
On reloading the card the system automatically reconnects the power. "You only pay for what you use," said Lucas.
KPLC is expected to be the major beneficiary of the project as it can dispense with metre readers, compiling, printing and posting bills monthly and tellers who receive money from customers.
In December 30, last year, KPLC launched an automatic metre reading system for its over 4,000 large power customers who account for 63 per cent of the company’s business in a bid to reduce billing errors and improve power supply quality.
Core functions
Incepted in 2000, APG is a deep-rooted economic group whose corporate office is located in the Republic of Sudan while its Financial Services and Technical Development and Power projects offices are located in Dubai and Kenya respectively.
The company’s other branches offices include business development offices in London (UK), Seoul (Korea), Addis Ababa (Ethiopia) and Beijing (China).
The group, which has many development partners and corporations worldwide, is considered a major commercial groups in Sudan in respect to the volume of its investments and its competitive position in the market.
