KenGen, the state-owned electricity provider in Kenya, has announced an impressive 48% surge in its profit after tax for the fiscal year concluding in June 2023. This substantial profit growth is largely attributed to enhanced operational efficiency and the expanded capacity of the company's geothermal facilities located in Olkaria, near Naivasha, Kenya.
The company's profit figure has soared from Ksh 3.4 billion (approximately USD 22.58 million) to Ksh 5.02 billion (approximately USD 33.33 million) over the past year. Moreover, KenGen has reported a commendable 14% increase in its revenues, climbing from Ksh 47.47 billion to Ksh 53.96 billion.
Peter Njenga, the Managing Director and CEO of KenGen, underscored that the boosted profit can be largely attributed to the augmented operational efficiency of the Olkaria geothermal facilities, along with the heightened installed capacity resulting from the recent commissioning of the 86-MW Olkaria I Additional Unit 6 geothermal power plant.
Njenga stated, “The commissioning of Olkaria I AU 6 geothermal power plant pushed up our geothermal generation by 24%. This contributed to an overall increase in electricity unit sales from 7,918GWh in 2022 to 8,027GWh.” Furthermore, he added that KenGen played a crucial role in supplying over 66% of Kenya's total electricity consumption for the year.
In anticipation of the surging demand for electricity in Kenya, which is currently growing at approximately 5% annually, KenGen has outlined plans to add more generation capacity in the coming years. The company aims to achieve an additional 154 MW of new installed capacity over the next two years through the rehabilitation and uprating of its existing power plants.
KenGen had previously secured funding from the European Union for the refurbishment of the Olkaria I and IV geothermal power plants. These plans encompass turbine uprating, which will elevate the capacity of these two geothermal power stations from their current 280 MW to 320 MW.
It's worth noting that KenGen experienced an increase in operating costs over the past year, attributed to rising insurance and impairment costs. However, these costs were effectively offset by the company's robust revenue growth.