How 31-year-old Dennis Mbwika landed Sh2.9bn Kenya Power meter tender |

ENTERTAINMENT

Kenya Power has used a colonial law to award a Sh2.9 billion tender for the supply of smart meters to a 31-year-old investor, shining a spotlight on ‘tenderpreneurs’ of the new administration.

The utility firm on September 15 offered Harley Berry Ltd a contract to supply 320,800 meters in a selection done by the little-known Supplies Branch unit of the State department for Public Works.

The ownership, choice and swift selection of the firm has raised eyebrows in the award of the multibillion-shilling tender.

Records at the Business Registry indicate that Harley Berry is owned by Mr Dennis Mbwika, who is believed to be a front of a powerful businessman who offered support to the Kenya Kwanza government ahead of August 2022 polls.

Questions have been raised on why Kenya Power opted to use the Supplies Branch instead of directly tendering for the smart meters, which are not available for use by other State agencies.

Supplies Branch, which was established in 1960, to help the State procure goods in bulk and enjoy favourable pricing through economies of scale, in particular for products used by multiple ministries and agencies.

Its selection of firms is less rigorous compared to tendering by State-owned companies that demands open competitive bidding in line with the public procurement laws.

Supplies Branch on September 5 placed Harley Berry Ltd in a short list of firms that could be tapped by Kenya Power to supply electrical products at short notice in the two years to September 2025.

Kenya Power on September 13 contacted the firms in the shortlist, arguing that it was suffering from a meter crunch that had slowed down connection of homes and businesses to the nation grid and it needed companies with ready stocks.

The utility demanded a response from the firms by close of business, underlining the urgency of the supplies.

Hours later on September 15, the electricity distributor informed Harley Berry Ltd that it had been awarded the contract to supply 320, 800 meters.

“We refer to the referenced Supplies Branch contracts and are pleased to inform you that following due diligence and evaluation, you have been considered,” Kenya Power CEO Joseph Siror informed Harley Berry on September 15 in reference to the deal.

This has triggered questions on why Harley Berry would have smart meters worth Sh2.9 billion at short notice without the guarantee it would be tapped to supply Kenya’s sole electricity distributor with the items.

Dr Siror declined to comment directly on the Harley Berry deal, hoisting his Christian faith as a guide to his work while quoting Timothy chapter four verse eight.

“Brother, I chose 36 years ago to live for God and have a clear conscience in all that I do, I am cognizant of the environment we live in,” Dr Siror said in a WhatsApp message. “Have you ever considered getting saved and living for him?”

Little is known about Mr Mbwika who is listed as the sole director and shareholder of Harley Berry with 100 shares.

At registration, the firm had 100,000 nominal shares, which left it a lot of headroom to bring on board other shareholders.

An internet search does not reveal Mr Mbwika’s business profile or career path. His call went unanswered.

“The young man is listed as 31 years old, where did he get the money for Sh2.9 billion worth of tenders?” posed a Kenya Power insider who sought anonymity.

The use of the Supplies Branch, whose activities waned from the early 1980s following mounting conflict of interest cases and Kenya’s adoption of economic liberalisation, came in the middle of tender fights at Kenya Power over supply of smart meters.

The public procurement watchdog has raised concerns over the Sh5.4 billion tender for the supply of meters, which was restricted to local manufacturers and assemblers.

KPLC advertised the bid for the supply of meters on February 3, 2023, initially restricted to local manufacturers only for it to issue a series of six addendums opening up the contract to include local assemblers.

Four local assemblers and manufacturers including Inhemeter Africa Company Ltd, Smart Meter Technology Ltd, Yocan Group Ltd and Magnate Ventures Ltd were awarded the lucrative tender.

A petition seeking review of the tender reckons that the process leading to the award was marred by procedural and substantive irregularities including breach of several sections of the Public Procurement and Asset Disposal Act.

It adds that mandatory terms on conditions for tender and eligibility were substantially and irregularly altered to defeat the need for competitive bidding.

The High Court in May stopped Kenya Power from proceeding with the smart meters tender.

The power utility firm had defended itself saying that by the end of April this year, there was a backlog of 500,000 meters for new connections and replacements and that the backlog was growing by the day.

The utility says the meters are required by critical and essential providers such as hospitals, health centres, dispensaries and schools, government installations, domestic consumers, and companies who have paid for the meters.

Kenya Power is betting on smart meters to grow its revenue by replacing its old meters that are prone to tampering, denying it income through unpaid bills.

State House through the head of Public Service Felix Koskei expressed discomfort in the use of the Supplies Branch for procurement in government, arguing that the State was losing money through inflated prices.

Mr Koskei in February asked ministries and parastatals to drop procurement deals inked through the Supplies Branch.

He ordered for fresh tendering or market testing of all common user goods procured through Supplies Branch to establish the market price of the products.

“It has come to the attention of this office that ministries, State departments and State agencies are not upholding the principles of public finance management,” said Mr Koskei in a memo sent to principal secretaries and Cabinet secretaries in reference to increased use of the Supplies Branch.

“The existing framework agreements between all MDAs and the State department for Public Works be and are hereby vacated.”

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