Court orders Kenya Power to execute Sh6b meters tender

The High Court has ordered Kenya Power to execute a Sh6 billion smart meters contract with a Chinese company that had been cancelled.

Justice Roselyn Aburili said the Public Procurement Administrative Review Board (PPRB) erred by failing to consider that Justice John Chigiti had settled the case in favour of Hexing Technology, the Chinese company, and Magnate Ventures.

“By annulling the awards in Categories 2 and 3 and directing fresh tendering, the Board reopened and re-determined issues that had already been conclusively settled by a superior court in direct defiance of unambiguous orders prohibiting re-tendering and definitive findings that the tender categories were separate and distinct,” said Justice Aburili.

Hexing Technology and Magnate separately sued PPARB and Kenya Power and Lighting Company (KPLC), arguing that the board’s decision in October last year to have the tender re-advertised amounted to circumventing orders that expressly barred KPLC from re-tendering.

“The board violated its legitimate expectations by disregarding binding court orders, exceeding its statutory jurisdiction, and cancelling a tender award that had crystallised into a lawful and protected legal right,” argued Hexing Technology.

The firm told the court that another Chinese firm, Chint Meters and Electric Kenya, had urged PPARB to quash its disqualification from the tender and direct the electricity marketing company to call for a fresh application.

It further argued that Justice Chigiti had ruled the tender to be valid; hence, his finding was binding on KPLC and PPARB.

It asserted that the fresh order was a clear violation of the High Court and, in turn, ended up as an appeal determined by a lower judicial body, which is contrary to the hierarchy of courts.

At the same time, the company argued that Chint was not a tenderer, therefore did not have the authority to sue.

It contended that the board contradicted itself as it held that the tender had not been carried out in accordance with the law, while at the same time finding that the successful bidders were determined through a compliant procedure.

On the other hand, Magnate Ventures argued that PPARB erred by holding that KPLC needed to physically visit local manufacturers and assemblers’ factories for inspection, but ignored that it had previously supplied the meters.

Magnate asserted that the tendering document was clear that the inspection would only be done if a tenderer had not previously participated in the tendering process.

It argued that the tender evaluation committee had properly conducted due diligence on Abcos Industrial Ltd and House of Procurement Ltd, who were successful tenderers in Category 3 and had no prior supply history, and prepared a report as required by the law.

It contended that the board acted in excess powers by finding that the same ought to have been done for all bidders.

It argued that the categories awarded  were independent from one another; hence, the board ought to have concentrated on the contested ones.

PPARB, in its response, argued that it complied with Justice Chigiti’s orders. It argued that it re-heard and nullified awards in Categories two and three only.

Losses

According to the board, the evaluation committee’s approach was neither transparent, predictable or lawful.

“The evaluation and award process lacked transparency, failed the test of cost-effectiveness, and did not comply with the tender document,” argued PPARB, adding:

“The Board also noted the absence of a detailed evaluation summary, selective and inconsistent application of due diligence.”

It also averred that the committee had used outdated market surveys in the process. It urged the court to uphold its decision.

KPLC, on the other hand, told the court that  it urgently needed 420,000 electricity meters,  a number which continues to grow and is already causing serious harm to the public.

The corporation said that it had allocated 167,000 to local dealers with ready stock while lot 2 had 270,000 for suppliers who had previously participated and lot three, for 200,000, was for local manufacturers or assemblers.

It argued that, after evaluation, it awarded tenders worth Sh5.7 billion. KPLC said that the wars in court had pushed losses beyond Sh7 billion.

KPLC faulted the board for requiring it to re-tender, arguing that it was contrary to the annual procurement plans.