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Win for firms as Kenya Power tender nullified

BUSINESS
By Macharia Kamau | August 17th 2021

Kenya Power workers fix a 3 phase distribution transformer of 250KVA at Ndimaini Village in Karatina, Nyeri.[Kibata Kihu,Standard]

Local firms have scored big in their quest to secure contracts in the construction of power lines and other related jobs.

This is after the Procurement Administrative and Review Board (APRB) ruled in their favour, directing Kenya Power to re-tender the contracts. The board also ordered Kenya Power to give preference to local contractors. 

“The procuring entity’s (Kenya Power) bidding document… in respect of procurement of plant, supply and extension of lower voltage lines – Last Mile Connectivity issued on May 18, 2021, be and is hereby nullified and set aside,” said the APRB in its July decision.

The board directed Kenya Power to prepare fresh bids within a month of issuing the ruling and re-tender them within 45 days.

“The procuring entity is hereby directed to unbundle the tender into reasonably smaller lots and to apply preference margins in compliance with African Development Bank (AfDB) rules for procurement of goods and services, the Constitution of Kenya, 2010 and the Public Procurement and Asset Disposal Act, 2015,” said the board.

The contractors had lodged a protest at the APRB against the manner in which Kenya Power had sought to recruit firms for the supply and extension of low voltage lines for one of the phases of the last mile connectivity project.

Through their lobby, Power Transmission Line Contractors Association, the firms claimed requirements in the tender were discriminatory, ensuring only foreign firms bag the contract.

The lobby said local contractors had been technically barred by restrictive bidding requirements.

High turnover

The requirements they deemed prohibitive included high turnover and “high and unrealistic” cash flow requirements.

They also wanted Kenya Power to divide the tender into smaller lots. The job was to be done in three lots, with the first lot covering Homa Bay, Kisii, Migori, Nyamira, Kericho and Bomet counties.

The second lot would cover Kisumu, Siaya, Vihiga, Busia, Bungoma and Kakamega counties while the third was to cover Embu, Murang’a, Meru and Tharaka Nithi counties.

Kenya Power had defended the requirements, saying it complied with AfDB rules, which require open and international competitive bidding for such projects.

The power distributor submitted to the tribunal the six contractors that had bidden and won tenders in previous phases.

It also noted that local contractors could have joined hands and bidden as joint ventures.

The board dismissed claims by contractors that the technical and experience thresholds set out by Kenya Power were impracticable.

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