KenGen profit jumps 35 per cent to Sh6.8b on higher power output

Kenya Electricity Generating Company PLC (KenGen) has posted a Sh.6.8 billion profit after tax for the year ended June 2024, representing a 35 per cent increase from the previous year.

This was on the back of a strong growth in revenues from its geothermal and hydroelectric power plants.

The firm also recorded a Sh4.2 billion finance income, representing a 149 per cent increase, nearly tripling the Sh1.7 billion recorded in 2023.

KenGen Chief Executive Peter Njenga hailed the performance amid a volatile economic landscape.

“This impressive growth not only strengthens our financial position but also signals greater returns for shareholders now and long into the future, while enhancing our ability to invest in critical renewable energy projects providing more affordable, reliable electricity for our consumers,” said Eng Njenga.

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The company reported dispatching 8,384GWh (Gigawatt hours) of electricity during the year, up from 8,027GWh in 2023.

The increase came despite unpredictable weather conditions and inflationary pressures that have affected many businesses in Kenya.

Eng Njenga said the company was able to maintain a stable operating profit of Sh9.6 billion by focusing on cost management and efficiency improvements.

Additionally, he said, KenGen’s geothermal and hydroelectric facilities were critical to meeting the country’s peak electricity demand of 2,149MW during the year.

“Despite the harsh global macroeconomic challenges, characterised by high inflation and foreign exchange fluctuations, we were able to instill financial discipline and prudent cost management measures in our operations which has seen us flatten the operational costs,” said Eng Njenga.

KenGen’s revenues rose to Sh56.3 billion, a gain of Sh2.3 billion from the previous year. The company’s power generation output grew by four per cent despite the decommissioning of over 130MW of fossil fuel-powered plants.

The firm, which produces about 70 per cent of the electricity consumed in Kenya, places the country as a leader in renewable energy on the African continent, with up to 90 per cent of its electricity generated from renewable sources.

KenGen’s outlook for the future is anchored in its Good-2-Great (G2G) 2024– 2034 Corporate Strategy, which is designed to propel the company into its next phase of growth.

The strategy focuses on increasing renewable energy capacity by about 1,500MW, enhancing operational efficiency, and leveraging cutting-edge technologies to stay ahead in a rapidly evolving energy sector.

“We have several major renewable energy projects in our pipeline, the 42.5MW Seven Forks solar plant, rehabilitation of Olkaria I geothermal power plant to give us 63MW and redevelopment of Gogo hydropower station targeting a total of 8.6MW,” said Eng Njenga.