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KPLC vs KENGEN Accounts: Sh26B Missing
Rank: Veteran Joined: 11/13/2015 Posts: 1,653
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BKB wrote:3rd August 2018
KENGEN 6.20
KPLC 6.00
A downtrodden tug of war.
Kengen is well run but tied to the hip with its sole customer KPLC. If KPLC goes south so does kengen.
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Rank: Elder Joined: 12/4/2009 Posts: 10,804 Location: NAIROBI
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wukan wrote:BKB wrote:3rd August 2018
KENGEN 6.20
KPLC 6.00
A downtrodden tug of war.
Kengen is well run but tied to the hip with its sole customer KPLC. If KPLC goes south so does kengen. Both have huge debts and still taking in more. Kulipa itakuwa matanga Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Rank: Veteran Joined: 9/21/2011 Posts: 2,032
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murchr wrote:Am sure many commenting have not read the article but the writer gives a very good hypothesis. The accountants and auditors of the 2 firms need to have a seating with the parliamentary committee on energy. Something is a miss Quote:the amount Kenya Power says it paid out is more than what KenGen says it received.
In total, the cumulative difference between the two figures over the 10-year period comes to over Sh26bn! This represents a shortfall of about 12 per cent.
I really look forward to an explanation of this persistent difference in the payments and receipts. It is quite troubling.
Going back to the original question about the fixed charge, I did a quick test of my own hypothesis. Kenya Power started the financial year with 3.7 million domestic customers and closed with 4.6 million. Thus, the median number was about 4.1 million. Each one of them was charged Sh150 per month, making a total of Sh622 million or about Sh7.4bn in the year.
In the same period, KenGen declared that it received Sh21.7bn as “Capacity Charges” – its “fixed charge” to Kenya Power. This amount is much larger than the Sh7.4bn collected by Kenya Power. Troubles at KP caused mainly by tenderprenuers who took advantage mainly of the last mile. And the assumed stimulus to economy owing to last mile never came to be coz the last mile power is used just for lighting, or people don't even pay hence investment cannot be recovered in medium term. Talk of effects of poor economic planning reinforced with high level looting.
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Rank: Elder Joined: 12/4/2009 Posts: 10,804 Location: NAIROBI
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limanika wrote:murchr wrote:Am sure many commenting have not read the article but the writer gives a very good hypothesis. The accountants and auditors of the 2 firms need to have a seating with the parliamentary committee on energy. Something is a miss Quote:the amount Kenya Power says it paid out is more than what KenGen says it received.
In total, the cumulative difference between the two figures over the 10-year period comes to over Sh26bn! This represents a shortfall of about 12 per cent.
I really look forward to an explanation of this persistent difference in the payments and receipts. It is quite troubling.
Going back to the original question about the fixed charge, I did a quick test of my own hypothesis. Kenya Power started the financial year with 3.7 million domestic customers and closed with 4.6 million. Thus, the median number was about 4.1 million. Each one of them was charged Sh150 per month, making a total of Sh622 million or about Sh7.4bn in the year.
In the same period, KenGen declared that it received Sh21.7bn as “Capacity Charges” – its “fixed charge” to Kenya Power. This amount is much larger than the Sh7.4bn collected by Kenya Power. Troubles at KP caused mainly by tenderprenuers who took advantage mainly of the last mile. And the assumed stimulus to economy owing to last mile never came to be coz the last mile power is used just for lighting, or people don't even pay hence investment cannot be recovered in medium term. Talk of effects of poor economic planning reinforced with high level looting. Injunction on the new tariffs could be ruled by the court this week. Lows last seen decades ago on the share price will be witnessed. Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Rank: Member Joined: 8/6/2018 Posts: 299
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This is the problem when Market Analysts and Participants give quacks from seat in Financial Statement Analysis. Energy sector , like any other specialist sector requires deep understanding of the cost build up and what they actually mean. FIRST FIXED CHARGES is not the same as CAPACITY CHARGES. FIXED CHARGES, say of 150 shillings payable by each customer (SAY 4.1 MILLION CUSTOMERS as the writer says) per month represents the meter rent for the METER supplied to the customer, meaning even if the customer doesnt consume a single unit, he will pay a fixed charge of Ksh 150, that represents fixed operating cost for the customers. this fixed charges( 150 time number of customers is reported by KPLC as revenue.
CAPACITY CHARGES represents the cost of power purchase that KPLC pays to KENGEN and other IPP per month/year even when it doesnt buy energy from them. in the energy Sector, You have a Power Purchase Agreement(PPA) which stipulates the bulk Power Purchase tariff. a PPA will have FCCR(Fixed capacity charge rate) and (VOMCR-Variable operating and maintenance charge rate)...The VOMCR which is also called energy rate, is payable depending on how much actual energy is being supplied to KPLC. Like all KenGEN Hydro plants have capacity charge rates...Capacity charges recovers the Capital costs of a Generation Plant...the Energy costs recovers the Operating costs of the plant
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Rank: Member Joined: 3/8/2018 Posts: 507 Location: Nairobi
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Shareholders in GoK-controlled firms are screwedQuote:
“Out of the 525 companies listed to render services to Kenya Power, which I checked at the registrar of companies, 136 were not authenticated and therefore did not meet the criteria set to offer services to the sole power distributor,"
Mr Kipng’eno further said 262 companies pre-qualified by Kenya Power did not have the National Constructions Authority certificates mandating them to offer services.
The auditor, who was instructed to carry out an in-depth audit on the acquisition of faulty transformers that caused the firm a huge loss, said he established that due diligence was not followed.
He said alterations on specifications were done after the opening of the tender documents.
Mr Kipng’eno established that there was conflict of interest as some of the companies listed to render services belonged to KP employees.
He (auditor) said he recommended administrative action be taken against Beatrice Meso, the company secretary, Joshua Mutua, general manager commercial services, Abubakar Swaleh, general manager human resource and administration, Samuel Ndirangu, ICT general manager, Stanley Mutwiri, general manager infrastructure development, Benson Muriithi, general manager network management, Peter Mwicigi, general manager regional co-ordination and John Ombui, the head of supply chain.
The managers have been charged with procuring substandard transformers that caused Kenya Power a Sh408 million loss.
They are accused of conspiring to commit an economic crime on diverse dates between August 3, 2013 and June 12, 2018 when they procured transformers worth Sh408,533,221 from Muwa Trading Company.
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Rank: Veteran Joined: 8/28/2015 Posts: 1,247
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KaunganaDoDo wrote:This is the problem when Market Analysts and Participants give quacks from seat in Financial Statement Analysis. Energy sector , like any other specialist sector requires deep understanding of the cost build up and what they actually mean. FIRST FIXED CHARGES is not the same as CAPACITY CHARGES. FIXED CHARGES, say of 150 shillings payable by each customer (SAY 4.1 MILLION CUSTOMERS as the writer says) per month represents the meter rent for the METER supplied to the customer, meaning even if the customer doesnt consume a single unit, he will pay a fixed charge of Ksh 150, that represents fixed operating cost for the customers. this fixed charges( 150 time number of customers is reported by KPLC as revenue.
CAPACITY CHARGES represents the cost of power purchase that KPLC pays to KENGEN and other IPP per month/year even when it doesnt buy energy from them. in the energy Sector, You have a Power Purchase Agreement(PPA) which stipulates the bulk Power Purchase tariff. a PPA will have FCCR(Fixed capacity charge rate) and (VOMCR-Variable operating and maintenance charge rate)...The VOMCR which is also called energy rate, is payable depending on how much actual energy is being supplied to KPLC. Like all KenGEN Hydro plants have capacity charge rates...Capacity charges recovers the Capital costs of a Generation Plant...the Energy costs recovers the Operating costs of the plant Mungu saidia watoto wako, kunasunami hapa Lost fixed charge revenue Per month 150/=×4.1=615millions Per annum 615×12=7.45bn Lost just like that. Even if meters are given to kplc for free that money is lost without replacement. Add on top metering costs still on or as always been. If I still need to reassure myself, I classfy that revenue stream as other revenues/other operating income or otherwise. And that other revenue is comparingly that figure and the figure closely indicates kplc makes profits from fixed charges and not operations.  Hii ingenirarua pahali pengine pabya. A close save very close save. @xxxx almost got me to think how sad it was for me to miss out on @ARM. All I have to note is, hile transformer yenye ilikua yazusha hii kitu, ndio imeanza Safari tu. It's coming down with everything and leaving just nothing on it's wake down to ground zero. I can not touch this one above zero point 6/=. Unless walipe mumias for sabotage of operations first.  . Sending pictorial illustrations has isn't been easy, but soonest I see how, you too will have a chance to appreciate that the elephant in the house too has a loose behind. ,Behold, a sower went forth to sow;....
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Rank: Member Joined: 8/6/2018 Posts: 299
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muandiwambeu wrote:KaunganaDoDo wrote:This is the problem when Market Analysts and Participants give quacks from seat in Financial Statement Analysis. Energy sector , like any other specialist sector requires deep understanding of the cost build up and what they actually mean. FIRST FIXED CHARGES is not the same as CAPACITY CHARGES. FIXED CHARGES, say of 150 shillings payable by each customer (SAY 4.1 MILLION CUSTOMERS as the writer says) per month represents the meter rent for the METER supplied to the customer, meaning even if the customer doesnt consume a single unit, he will pay a fixed charge of Ksh 150, that represents fixed operating cost for the customers. this fixed charges( 150 time number of customers is reported by KPLC as revenue.
CAPACITY CHARGES represents the cost of power purchase that KPLC pays to KENGEN and other IPP per month/year even when it doesnt buy energy from them. in the energy Sector, You have a Power Purchase Agreement(PPA) which stipulates the bulk Power Purchase tariff. a PPA will have FCCR(Fixed capacity charge rate) and (VOMCR-Variable operating and maintenance charge rate)...The VOMCR which is also called energy rate, is payable depending on how much actual energy is being supplied to KPLC. Like all KenGEN Hydro plants have capacity charge rates...Capacity charges recovers the Capital costs of a Generation Plant...the Energy costs recovers the Operating costs of the plant Mungu saidia watoto wako, kunasunami hapa Lost fixed charge revenue Per month 150/=×4.1=615millions Per annum 615×12=7.45bn Lost just like that. Even if meters are given to kplc for free that money is lost without replacement. Add on top metering costs still on or as always been. If I still need to reassure myself, I classfy that revenue stream as other revenues/other operating income or otherwise. And that other revenue is comparingly that figure and the figure closely indicates kplc makes profits from fixed charges and not operations. Hii ingenirarua pahali pengine pabya. A close save very close save. @xxxx almost got me to think how sad it was for me to miss out on @ARM. All I have to note is, hile transformer yenye ilikua yazusha hii kitu, ndio imeanza Safari tu. It's coming down with everything and leaving just nothing on it's wake down to ground zero. I can not touch this one above zero point 6/=. Unless walipe mumias for sabotage of operations first. . Sending pictorial illustrations has isn't been easy, but soonest I see how, you too will have a chance to appreciate that the elephant in the house too has a loose behind. Boss, i told you to discuss matters you fully understand...The fixed charges were converted to Energy Charges...But since you hardly understands, and you derive pleasure in misleading people, stick to your slow lane...Anyway, The fixed charges were loaded to energy rate(kWh charge) and spread across the different tariff segments...
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Rank: Veteran Joined: 8/28/2015 Posts: 1,247
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KaunganaDoDo wrote:muandiwambeu wrote:KaunganaDoDo wrote:This is the problem when Market Analysts and Participants give quacks from seat in Financial Statement Analysis. Energy sector , like any other specialist sector requires deep understanding of the cost build up and what they actually mean. FIRST FIXED CHARGES is not the same as CAPACITY CHARGES. FIXED CHARGES, say of 150 shillings payable by each customer (SAY 4.1 MILLION CUSTOMERS as the writer says) per month represents the meter rent for the METER supplied to the customer, meaning even if the customer doesnt consume a single unit, he will pay a fixed charge of Ksh 150, that represents fixed operating cost for the customers. this fixed charges( 150 time number of customers is reported by KPLC as revenue.
CAPACITY CHARGES represents the cost of power purchase that KPLC pays to KENGEN and other IPP per month/year even when it doesnt buy energy from them. in the energy Sector, You have a Power Purchase Agreement(PPA) which stipulates the bulk Power Purchase tariff. a PPA will have FCCR(Fixed capacity charge rate) and (VOMCR-Variable operating and maintenance charge rate)...The VOMCR which is also called energy rate, is payable depending on how much actual energy is being supplied to KPLC. Like all KenGEN Hydro plants have capacity charge rates...Capacity charges recovers the Capital costs of a Generation Plant...the Energy costs recovers the Operating costs of the plant Mungu saidia watoto wako, kunasunami hapa Lost fixed charge revenue Per month 150/=×4.1=615millions Per annum 615×12=7.45bn Lost just like that. Even if meters are given to kplc for free that money is lost without replacement. Add on top metering costs still on or as always been. If I still need to reassure myself, I classfy that revenue stream as other revenues/other operating income or otherwise. And that other revenue is comparingly that figure and the figure closely indicates kplc makes profits from fixed charges and not operations. Hii ingenirarua pahali pengine pabya. A close save very close save. @xxxx almost got me to think how sad it was for me to miss out on @ARM. All I have to note is, hile transformer yenye ilikua yazusha hii kitu, ndio imeanza Safari tu. It's coming down with everything and leaving just nothing on it's wake down to ground zero. I can not touch this one above zero point 6/=. Unless walipe mumias for sabotage of operations first. . Sending pictorial illustrations has isn't been easy, but soonest I see how, you too will have a chance to appreciate that the elephant in the house too has a loose behind. Boss, i told you to discuss matters you fully understand...The fixed charges were converted to Energy Charges... But since you hardly understands, and you derive pleasure in misleading people, stick to your slow lane...Anyway, The fixed charges were loaded to energy rate(kWh charge) and spread across the different tariff segments... I think you have mental retardation to fail to see that was a guranteed revenue, now draw the lines between guranteed revenue and marginal revenues in a regime hell bent to make energy cheap for users. Of the 10/% top up on revenue from fixed charges, by what margin will the passed on fixed charges contribute to the revenue growth. Figures don't lie, so thieves do figure too. Your figures are in public domain, not a special discovery in your mental context to dispell disparage my duty to get figures right and make meaningful decisions. And for correction purposes, read the current numbers are over 4.65m. so get not me into slow lanes, neither name calling nor pleasing you off me as I am pleased to intuitively live off my conginital endeavors. I do live on the sense I draw from info in the market. Only that I go a further step to make that info money friendly @helloyellow. Am not ur advisor. Neither am I responsible to your decisions. ,Behold, a sower went forth to sow;....
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Rank: Elder Joined: 12/4/2009 Posts: 10,804 Location: NAIROBI
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KaunganaDoDo wrote:muandiwambeu wrote:KaunganaDoDo wrote:This is the problem when Market Analysts and Participants give quacks from seat in Financial Statement Analysis. Energy sector , like any other specialist sector requires deep understanding of the cost build up and what they actually mean. FIRST FIXED CHARGES is not the same as CAPACITY CHARGES. FIXED CHARGES, say of 150 shillings payable by each customer (SAY 4.1 MILLION CUSTOMERS as the writer says) per month represents the meter rent for the METER supplied to the customer, meaning even if the customer doesnt consume a single unit, he will pay a fixed charge of Ksh 150, that represents fixed operating cost for the customers. this fixed charges( 150 time number of customers is reported by KPLC as revenue.
CAPACITY CHARGES represents the cost of power purchase that KPLC pays to KENGEN and other IPP per month/year even when it doesnt buy energy from them. in the energy Sector, You have a Power Purchase Agreement(PPA) which stipulates the bulk Power Purchase tariff. a PPA will have FCCR(Fixed capacity charge rate) and (VOMCR-Variable operating and maintenance charge rate)...The VOMCR which is also called energy rate, is payable depending on how much actual energy is being supplied to KPLC. Like all KenGEN Hydro plants have capacity charge rates...Capacity charges recovers the Capital costs of a Generation Plant...the Energy costs recovers the Operating costs of the plant Mungu saidia watoto wako, kunasunami hapa Lost fixed charge revenue Per month 150/=×4.1=615millions Per annum 615×12=7.45bn Lost just like that. Even if meters are given to kplc for free that money is lost without replacement. Add on top metering costs still on or as always been. If I still need to reassure myself, I classfy that revenue stream as other revenues/other operating income or otherwise. And that other revenue is comparingly that figure and the figure closely indicates kplc makes profits from fixed charges and not operations. Hii ingenirarua pahali pengine pabya. A close save very close save. @xxxx almost got me to think how sad it was for me to miss out on @ARM. All I have to note is, hile transformer yenye ilikua yazusha hii kitu, ndio imeanza Safari tu. It's coming down with everything and leaving just nothing on it's wake down to ground zero. I can not touch this one above zero point 6/=. Unless walipe mumias for sabotage of operations first. . Sending pictorial illustrations has isn't been easy, but soonest I see how, you too will have a chance to appreciate that the elephant in the house too has a loose behind. Boss, i told you to discuss matters you fully understand...The fixed charges were converted to Energy Charges...But since you hardly understands, and you derive pleasure in misleading people, stick to your slow lane...Anyway, The fixed charges were loaded to energy rate(kWh charge) and spread across the different tariff segments...  Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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KPLC vs KENGEN Accounts: Sh26B Missing
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