KETRACO Annual Report

AnnuAl RepoRt& FinAnciAl stAtements

Building a World Class national Grid

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AnnuAl RepoRt& F inAnciAl stAtements the KenyA electRicity tRAnsmission compAny limited

Our VisiOn

“to be a world-class electricity transmission company and the leading inter-connector in Africa”

Our MissiOn

“To build and operate a national electricity transmission network that is reliable, efficient, effective, safe and environment-friendly through innovative and best practices; and to promote regional power trade for socio-economic development.”

CusTOMEr FOCus

The Company commits itself to attaining the highest standards in service delivery to all stakeholders.

inTEGriTY, TrAnsPArEnCY AnD ACCOunTABiLiTY

the company is committed to acting in an honest, transparent and responsible manner while implementing its programmes.

TEAMWOrKThe Company employees will work in unison at all levels and embrace a participatory approach in implementing all programmes and activities.

CrEATiViTY AnD innOVATiOn

the company will be a learning organization that embraces and continuously introduces change in its business processes.

COMMiTMEnTThe Company will embrace self-drive and hard work in attaining the highest standards in service delivery to all stakeholders.

EQuiTY The Company will uphold the highest levels of impartiality by treating all stakeholders without any discrimination whatsoever.

PrOFEssiOnALisMthe company’s operations will be guided by professional ethics aimed at building an appropriate corporate culture and creating the right corporate image.

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AnnuAl RepoRt& F inAnciAl stAtementsthe KenyA electRicity tRAnsmission compAny limited

contents1 corporate information 2

2 Board of directors 4 - 9

3 senior management staff 10 - 11

4 notice of Annual General meeting 12

5 ilani ya mkutano mkuu wa mwaka 13

6 chairman’s statement 14 - 15

7 muhtasari wa mwenyekiti 16 - 17

8 managing director & ceo’s overview 18 - 29

9 RipotiyaMkurugenziMkuunapiaAfisaMtendajiMkuu 30-40

10 corporate Governance statement 41 - 44

11 Report of the directors 45

12 statement of directors’ Responsibilities 46

13 Report of the independent Auditors 47

14 FinAnciAl stAtements

statement of comprehensive income 48

statement of Financial position 49

statement of equity 50

StatementofCashflows 51

notes to the Financial statements 52 - 62

detailed statement of comprehensive income 63 - 64

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corporate information

ReGisteRed oFFice &

pRincipAl plAce oF Business

diRectoRs

secRetARy

AuditoRs

AdvocAtes

2nd Floor, capitol hill squarechyulu Road, upper hillp.o. Box 34942 – 00100nairobi – KenyA

mr. Justus G. Kageenu – chairmaneng. Joel m. Kiilu - managing director & ceomr. patrick m. nyoike mr. Joseph K. Kinyua hon. Jimmy Ang’wenyiRev. (dr.) Jessie W. mutura mr. domiciano l. maingihon. Jaafar m. sheikhmr. daniel K. mwauramrs. Felister Kivisi - Alternate to Joseph Kinyua eng. Julius mwathani- Alternate to patrick nyoike

duncan K. machariap.o. Box 34942 – 00100nairobi. Kenya

deloitte & touche (For Auditor-General)CertifiedPublicAccountants(Kenya)deloitte place, Waiyaki Way, muthangarip o Box 40092 - 00100nairobi

the company maintains a panel of Advocates

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cApitol Hill sQuAReReGisteRed oFFice & pRincipAl plAce oF Business

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Board of directors

Hon. Jimmy Angw’enyi

eng. Julius mwATHAni (Alt. to mr. patrick nyoike ps, ministry of energy

mr. PATriCk nyoike (ps, ministry of energy)

mrs. FelisTer kivisi (Alt. to mr. Joseph Kinyua ps, treasury)

mr. DAniel k. mwAurA

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Board of directors

not in the pictuRemR. Joseph KinyuA

ps, treasury

Hon. JAFAAr moHAmmeD

mr. DomiCiAno mAingi

mr. JusTus kAgeenu (chairman)

eng. Joel m. kiilu (managing director & ceo)

mr. DunCAn mACHAriA (company secretary)

rev. (Dr) Jessie muTurA

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BoardofDirectors’Profiles

mr. JusTus g. kAgeenuchAiRmAn

Born in 1947, mr. Justus Kageenu holds a Bachelor of commerce degree from the UniversityofNairobiandisalsoaCertifiedAccountant. Justus has spent most of his working life in the energy sector particularly in the petroleum sub-sector where he has worked for exxon, Kenya petroleum RefineriesLimited(KPRL)andShell.

HejoinedtheBoardofKPRLin1997andbecame chairman in 2003 until February, 2009, when he was appointed the chairman of the Board of KetRAco.

eng Joel m. kiilu mAnAGinG diRectoR & ceo

Born in 1956, eng. Joel Kiilu is an electrical engineer and holds a masters degree in Business Administration (mBA) from the university of nairobi. he also holds a Bachelor of science (Bsc.) degree in electrical engineering from the same university.

eng. Kiilu is a member of institution of engineers of Kenya (mieK), a member of the institution of electrical and electronic engineers (mieee). he joinedThe Kenya Power & Lightingcompany limited as a trainee engineer in 1977 and rose to the position of chief manager, energy transmission from which he left to join KETRACO in the year 2009 todate.

mr. PATriCk m. nyoikeps eneRGy- diRectoR

mr. patrick m. nyoike was born on 30th september 1947. he holds a Bachelor of science degree in mathematics and physics from university of Ghana and a degree in economics from university of nairobi.

he is currently the permanent secretary, ministry of energy. mr. nyoike is a director of all the state corporations within the ministry of energy.

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mr. JosePH kinyuA ps, tReAsuRy- diRectoR

mr. Kinyua is the permanent secretary, ministry of Finance. he is a career economist having served in various capacities in the treasury and central Bank.

he has also been involved in several projects with the Internationalmonetary Fund both within Kenya and abroad. he holds mA and BA degrees in economics (uon).

Hon. Jimmy o. Ang’wenyi diRectoR

Born in 1945, hon. Jimmy Ang’wenyi holds a Bachelor of commerce degree from Washington & lee university and an mBA degree from duke university, both in usA. hon. Ang’wenyi served as the member of parliament for Kitutu chache and as an Assistant Minister in the Officeof the president. he also served as a member of several parliamentary committees, including the energy committee.

hon. Ang’wenyi has travelled widely and has participated in trade, anti-corruption, infrastructure and educational conferences. he is a member of AccA.

rev. (Dr.) Jessie w. muTurA diRectoR

Born in 1948, Rev. (dr) Jessie mutura holds an honorary doctorate of humanities and Good Governance from the united Graduate college & seminary (usA). Jessie started her career in banking before venturing into business in the private sector both local and in the international arena where she also served in various civic bodies.

Rev.(dr) Jessie has also served in voluntary activities and was appointed president of the Federation of national Associations of Women in Business, comesa and served chairperson in child Welfare society of Kenya for over 20 years. Rev. Jessie is currently a member of political parties disputes tribunal.

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mr. DomiCiAno l. mAingi diRectoR

Born in 1949, mr. domiciano maingi holds a master of Arts in international studies and Bachelor of psychology degrees both from the university of nairobi, and an executive management diploma from the university of nevada, usA.

mr. maingi is also an Auditor and Accountant, and has worked in the civil service as an Auditor in charge of several ministries and served as chief internal Auditor of nairobi city council and on the Board of local Government provident Fund. he is a leading fish farmer and currentchairman of the Aqua cultural Association of Kenya.

Hon. JAAFAr moHAmeD sHeikH diRectoR

hon. Jaafar mohammed was born in 1953 and has a diploma in Business Administration and a good accountancy background. he served in the 4th and 5th parliament as a member for mandera West constituency in the Republic of Kenya. hon. Jaafar is a prominent businessman. he is in the transport business and as a farmer, is also engaged in wheat seed propagation.

mr. DAniel k. mwAurA diRectoR

Born in 1966, mr. daniel Karuru mwaura is an Advocate of the high court of Kenya in private practice and has practised law for more than 13 years.

mr. mwaura is also a commissioner for oaths, notary public and holds a Bachelor of laws degree, Bachelor of Arts (econ) both from indore university and a post graduate diploma in laws from the Kenya school of law.

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mrs. FelisTer s. kivisi (AlteRnAte diRectoR to mR. J. KinyuA)

Born in 1967, Felister saliku Kivisi, serves as senior Assistant director in the ministry of Finance, debt management department. she holds a Bachelor of Arts degree from university of nairobi (1990) and a master of Arts degree in international Relations from the university of leeds (1992).

Felister who serves as Alternate director to mr. Joseph Kinyua, ps, treasury has a wealth of experience having worked in the ministry of Finance from 1994 to date.

eng. Julius mwATHAni (AlteRnAte diRectoR to mR. p. nyoiKe)

eng. Julius mwathani was born in 1960. he holds a Bachelor of science degree in mechanical engineering and an executive master of Business Administration degree.

eng. mwathani is registered by engineers Registration Board of Kenya and a member of the institution of engineers of Kenya. he has wide experience in public sector management, having worked for more than 20 years in various senior positions in Government.

mr. DunCAn k. mACHAriA compAny secRetARy/heAd oF leGAl seRvices

mr. duncan macharia was born in 1960. he holds a masters of Business Administration degree from the university of nairobi and a Bachelor of commerce (Business Administration option) degree from the same university.

DuncanisaCertifiedPublicSecretaryof Kenya (cps)K and previously worked as deputy company secretary in the Kenya power & lighting company limited before he left after serving the company for over18yearstojoinKETRACO.Heis also a member of the institute of directors, (iod) Kenya.

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management team

eng. Joel kiilu mAnAGinG diRectoR & ceo

Born in 1956, eng. Joel Kiilu is an electrical engineer and holds a masters degree in Business Administration (mBA) from the university of nairobi. he also holds a Bachelor of science (Bsc.) degree in electrical engineering from the same university.

eng. Kiilu is a member of institution of engineers of Kenya (mieK), a member of the institution of electrical and electronic engineers (mieee). he joined The Kenya Power & Lightingcompany limited as a trainee engineer in 1977 and rose to the position of chief manager, energy transmission fromwhichhe leftto joinKETRACOin the year 2009 to date.

mr. DunCAn k. mACHAriA compAny secRetARy/heAd oF leGAl seRvices

mr. duncan macharia was born in 1960. he holds a masters of Business Administration degree from the university of nairobi and a Bachelor of commerce (Business Administration option) degree from the same university.

Duncan is a Certified Publicsecretary of Kenya (cps)K and previously worked as deputy company secretary in the Kenya power & lighting company limited before he left after serving the company for over 18 years to joinKetRAco. he is also a member of the institute of directors, (iod) Kenya.

mr. Joe o. AgerGeneRAl mAnAGeR- inteRnAtionAl Business

Born in 1949, Joe Ager holds a master of Business Administration degree (mBA) and a Bachelor of science (Bsc) in marketing from the university of south Africa.

PriortojoiningKETRACOAgerworked as a customer Relations and marketing manager with Kenya power & lighting company limited. he also worked as managing consultant with sparrow and Barlow Associates, head of operations with British telecoms– uK, head of strategy and Business development with caudwell Group ltd. and head of Group sales with British Airways plc (uK).

ms. Agnes ongADi heAd oF Admin, hR & coRpoRAte AFFAiRs

Born in 1970 Agnes holds a Bachelor of commerce degree from the university of nairobi, an executive mBA from moi university and a post-Graduate diploma in human Resource management from Kenya institute of management.

Agnes is a full member of both the Kenya institute of management (AmKim) and institute of human Resource Management. Prior to joiningKetRAco she worked with the First American Bank and Kenol/Kobil petroleum company

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Dr. (eng.) JoHn mATivo heAd oF technicAl seRvices

Born in 1968, John mativo is a civil engineer and holds a doctorate degree from tokyo metropolitan university (Japan), a master’s degree from Tongji University (China) anda Bachelor’s degree from the university of nairobi.

John is a Registered engineer (Kenya engineers Registration Board) and a corporate member of the institution of engineers of Kenya. Before joining KETRACO as Head oftechnical services, he previously worked as a consultant for EuropeanUnionfundedprojectsin the local Government and as an engineer in the ministry of Roads and public Works.

mr. FernAnDes o. BArAsA heAd oF FinAnce

Born in 1973, mr. Barasa holds a Bachelor of commerce (Accounting) and mBA-Finance degrees from Kenyatta University.HeisalsoaCertifiedpublic Accountant of Kenya (cpA-K).

Prior to joining KETRACO,mr. Barasa worked as treasury manager and later head of Factories Accounts at Kenya tea development Agency limited. he also worked for Kenya Airways and east Africa Re in senior management positions. he has wealth of experience in Accounting and Financial management and serves on various committees of icpAK.

mrs. mumBuA giATi heAd oF ict

Born in 1960, mrs mumbua Giati holds a Bachelor of commerce degree (management science option) from the university of nairobi.

mumbua has a wealth of training and experience in it, having worked for the Kenya power & lighting company ltd. for 30 years and seen the company’s ict transition from proprietary legacy systems to modern eRp solutions. she previously held the position of chief systems Analyst, sAp at Kenya power before joining KETRACO ashead of ict in december 2009.

she is a member of the computer society of Kenya.

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notice of Annual General meeting

notice is heReBy Given thAt the 2nd AnnuAl GeneRAl meetinG of the Kenya electricity transmission company limited will be held at capitol hill square, 2nd Floor, upper hill, chyulu Road, nairobi, on 27th April 2012 at 11:00 a.m. to transact the following business:-

1. to read the notice convening the meeting.

2. Toreceive,considerandadopttheCompany’sauditedfinancialstatementsfortheTwelvemonthsendedon30thJune2011, together with the chairman’s, directors’ and Auditors’ Reports thereon.

3. to note that directors do not recommend payment of a dividend for the period under review.

4. election of directors: to note that there will be no election or rotation of directors.

Whereas the company was incorporated under the companies Act, cap 486, as a private company limited by shares, it is wholly owned by the Government. the company is, therefore, governed under the provisions of the state corporations Act, cap 446 by virtue of section 2 (c) of the Act. Further, Article 2 of its memorandum and Articles of Association provide that “the appointment and removal of directors shall be governed by the provisions of the state corporations Act, cap 446, of the laws of Kenya as amended from time to time.EachDirectorshallholdofficeuntilheisremovedorreplacedasprovidedabove.”KETRACOhascompliedwithCap446Sectionwhich provides for the composition and appointment of directors. under the circumstances, there will be no election of directors.

5. to note that the audit of the company’s books of accounts will be undertaken on behalf of the Auditor General by the m/s Deloitte&Touche,anauditfirmappointedinaccordancewithSection14(3)oftheStateCorporationsAct,andSection39(1)(b) of the public Audit Act, 2003. m/s deloitte & touche carried out the audit for the period ended 30th June, 2011 6. ToauthorisetheDirectorstofixtheAuditors’remuneration.

By oRdeR oF the BoARd

DunCAn MAChAriAcompAny secRetARy

16th march, 2012

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ilani ya mkutano mkuu wa mwaka

ilAni inAtoleWA KWAmBA mKutAmo mKuu WA pili WA KilA mWAKA wa Kenya elecricity transmission company limited utafanyikakatikajumbalaCapitolHillSquare,OrofayaPili,UpperHill,ChyuluRoad,Nairobi,Tarehe27thApri2012saatanoasubuhikushughuliajendazifuatazo:-

1. Kusoma ilani ya kuitisha mkutano.

2. Kupokea,kujadilinakuidhinishataarifayafedhazilizokaguliwakwamudawamiezikuminamiwilikufikiatarehe30Juni2011, pamojanaRipotiyaWakurugenzi,Mwenyekiti,naMkaguziwahesabu.

3. Kufahamu kwamba Wakurugenzi hawapendekezi malipo ya gawio kwa kipindi cha mwaka unaongaziwa.

4. uchaguzi wa Wakurugenzi: Kufahamu kwamba hakutakuwa na uchaguzi au mzunguko wa wakurugenzi.

ilhali Kampuni ilianzishwa chini ya sheria ya makampuni, sura ya 486 kama kampuni binafsi mdogo kwa hisa, inamilikiwa na serikali. Kwahivyo,KampunihiiinaongozwanamashartiyaSerikaliyaSheriayaMakampuni,Suraya446kwamujibuwakifungucha2(c)chasheria hiyo. Zaidi ya hayo, ibara ya 2 ya mkataba wake wa sheria ya chama huelekeza kuwa “uteuzi na kuondolewa kwa Wakurugenzi utaongozwa na masharti ya sheria ya makampuni, sura ya 446 ya sheria za Kenya, kama ilivyorekebishwa mara kwa mara. Kila kurugenzi atakuwaafisinihadikuondolewaaukubadilishwakwamujibuwasheriailivyoelezahapojuu.”KETRACOinazingatiaSuraya446Sehemuya 6 ya sheria ya Kampuni za Kenya ambayo inaratibisha muundo na uteuzi wa Wakurugenzi. Katika hali hii, hakutakuwa na uchaguzi wa Wakurugenzi.

5. Kufahamu kwamba ukaguzi wa vitabu akaunti ya Kampuni utafanyika kwa niaba ya mkaguzi mkuu wa hesabu, na Kampuni ya ukaguzi m/s deloitte & touche, Kampuni ya ukaguzi iliyoteuliwa kulingana na kifungu 14 (3) cha sheria ya mashirika ya serikali, na sehemu ya 39 (1) (b) ya sheria ya ukaguzi wa hesabu za umma ya mwaka 2003.

m / s deloitte & touche ilifanya ukaguzi wa taarifa ya fedha kwa kipindi kulichomalizika mnamo tarehe 30 Juni, 2011

6. Kuwaidhinisha Wakurugenzi kuamua malipo ya Wakaguzi.

KWA AmRi yA hAlmAshAuRi

DunCAn MAChAriAKAtiBu WA KAmpuni

16th march, 2012

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chairman’s statement

review oF THe eConomy

i have the pleasure to present the second annual report and auditedfinancialstatementsoftheKenyaElectricityTransmissioncompany limited for the twelve months period ended 30th June

2011.

The Macro-economic environment improved significantly in2010 compared to 2009. the Gross domestic product grew by 5.6% as compared to 2.6% in 2009. this was attributed to accelerated expansion in the various subsectors of the economy. Theeconomywasprojectedtogrowby5.3%in2011.Overallinflation increased from 4.5% inDecember, 2010 to 14.49% inJune2011.This togetherwith the foreign exchangefluctuationswill most likely adversely impact the growth of the economy.the outlook for 2011/2012 shows a combination of trends that could contribute to positive prospects in the short and medium term. the implementation of the constitution in 2010, favourable

weather and continued investment in infrastructure will enhance growth of the economy.

review oF THe eleCTriCiTy suB-seCTor

the level and the intensity of energy use in the country is a key indicator of economic growth and development. Kenya’s vision 2030hasidentifiedEnergyasoneoftheinfrastructuralenablersof its pillars and it is expected that more energy will be required in thecountryinordertorealisetheobjectivesoftheVision.

electricity remains the most sought after energy source by the Kenyan society and its access is normally associated with high quality of life. currently, electricity contributes 9% of total energy needs, biomass 68% and petroleum 22%. the current electricity consumption is 148 kilowatt hours (KWh) per capita and national connectivity is 29% both of which are below the average per capita consumption of 1,169 KWh and connectivity of 32% for developing countries.

mr. JusTus g. kAgeenu

chAiRmAn

Mr. Justus Kageenu (2nd right), Chairman of the Board of Directors of KETRACO hands over a dividend cheque to Mr. Joseph Kinyua, PS Treasury, as Esther Koimett, Investment Secretary, Treasury and Eng. Joel Kiilu, MD &

CEO, KETRACO look on.

“Electricity remains the most sought after energy source by the Kenyan society and access to it is normally associated with rising or high quality of life. Its current consumption is at 143 kilowatt hours (kWh) per capita and national connectivity rate of about 28.9% which is below the average of 32% for developing countries.”

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chairman’s statement

in view of this, KetRAco continues to construct transmission lines and associated substations in order to expand the national grid with a view to increasing the level of access and connectivity countrywide. in order to increase the intensity of electricity, the cost of electricity must be affordable to the consumers. towards this end the Government on behalf of KetRAco has continued to seek and obtain concessional funding from development partners to expand the grid. in addition, the company is working with regional power utilities to fast track interconnectivity in order to access cheaper power through power trade.

review oF PerFormAnCe

units of electricity transmitted, through the transmission lines owned by KETRACO, in the financial year 2010/2011 were364,000,000 Kwh. this was an increase from the 340,460,000 Kwh transmitted the previous year. the total income amounted to Kshs.940 million compared to Kshs.647 million in 2009/2010, while the total operating expenses for the period was Kshs.461 million compared to Kshs.223 million for the previous year. surplus for the year before tax was Kshs.480 million while net surplus was Kshs.422 million. this compares to a surplus before tax of Kshs.424 million and net surplus of Kshs.389 million the previous period.

the asset base grew from Kshs.8,761 million in 2010 to Kshs.18,986 million, an increase of 117% which is commendable.

Some of the development partners who funded the Mombasa-Nairobi 400kV transmission line Project accompanied by KETRACO Staff on a site visit

FuTure ouTlook

the company has embarked on an ambitious programme to expand electricity transmission network infrastructure. With more transmission lines being completed and commissioned, it is expected that the level of wheeled units will substantially increase, impacting positively on our turnover. With the continued support of the Government and our development partners, the planned transmissioninfrastructureprojectswillbeimplementedfullyandthis will go a long way in supporting the realisation of Kenya vision 2030.

tRiBute

i once again express my sincere gratitude and appreciation to the Board of directors, management, staff, the Government, particularly the ministry of energy and ministry of Finance, and our development and business partners for their continued support whichenabledKETRACOtoachievemajormilestonesduringtheperiod under review.

i look forward to your continued support.

Mr. JusTus G. KAGEEnucHAiRmAn

8th January, 2012

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muhtasari wa mwenyekiti

mr. JusTus g. kAgeenu

mWenyeKti

Wanachama wa Bodi na wafanyikazi waandamizi wakikagua ramani ya mradi wa Rabai-Lamu wakati wa ziara ya siku za nyuma.

tAtHmini yA ucHumi

nina furaha kuwasilisha ripoti ya pili ya kila mwaka na taarifa za fedha zilizokaguliwa za Kampuni ya Kenya electricity transmission limited, kwa kipindi cha miezi

kumi na miwili kilichomalizika tarehe 30 Juni 2011.

mazingira ya kiuchumi kwa upana yaliboreka kwa kiasi kikubwa katika mwaka wa 2010 ikilinganishwa na mwaka wa 2009. pato la taifa lilikua kwa 5.6% likinganishwa na 2.6% katika mwaka wa 2009. Huu ukuaji ulitokana na kupanuka kwa kasi katika sektandogo mbalimbali za uchumi. uchumi ulikuwa umekadiriwa kukua kwa5.3%katikamwakawa2011.Mfumukowabeikwaujumlauliongezeka kutoka 4.5% mwezi Desemba 2010 hadi kufikia14.49%mwezi Juni2011.Hayapamojanakushukakwathamaniya fedha za kigeni una uwezekano mkubwa wa kuathiri matokeo yaukuajiwauchumi.

mtazamo wa mwaka wa 2011/2012 unaonyesha mchanganyiko wamienendoambayoinawezakuchangiamatarajiochanyakatikamudamfupinawakati.UtekelezajiwaKatibayamwakawa2010,halinzuriyahewanauwekezajikatikamiundombinuyataendeleakuimarishaukuajiwauchumi.

TATHmini yA sekTA nDogo yA nguvu yA umeme

Kiwango na ukubwa wa matumizi ya nishati katika nchi ni kiashiria muhimuchaukuajiwauchuminamaendeleo.DirayaKenya2030imebainishaNishatikamamojayaviwezeshajivyamiundombinuzanguzo zake, na inategemewa kwamba nishati zaidi itatakiwa nchini ilikufikiamalengoyaDira2030.

umeme bado unabakia kuwa chanzo cha nishati ambayo inatafutwanaWakenyawenginaupatikanajiwakeunahusianana

“Umeme bado unabakia kuwa chanzo cha nishati ambayo inatafutwa na Wakenya wengi na upatikanaji wake unahusiana na maisha bora. Hivi sasa, umeme unachangia 9% ya mahitaji ya jumla ya nishati, inayotokana na mimea 68% na ya mafuta ya petroli 22%. Matumizi ya umeme kwa sasa ni masaa ya Kilowati 148 (kWh) kwa kila mtu na uunganishwaji wa kitaifa ni 29%, yote mawili yakiwa ni chini ya wastani wa matumizi ya 1,169 kWh na uunganishaji ukiwa 32% kwa nchi zinazoendelea.”

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muhtasari wa mwenyekiti

maishabora.Hivisasa,umemeunachangia9%yamahitajiyajumlaya nishati, inayotokana na mimea 68% na ya mafuta ya petroli 22%. matumizi ya umeme kwa sasa ni masaa ya Kilowati 148 (kWh) kwa kilamtunauunganishwajiwakitaifani29%,yotemawiliyakiwanichiniyawastaniwamatumiziya1,169kWhnauunganishajiukiwa32% kwa nchi zinazoendelea.

Kwa mtazamo huu, KETRACO inaendelea kujenga laini zausambazajiwa umemena vituo husika, ili kupanua gridi ya taifakwa lengo la kuongeza kiwango cha upatikanaji na uunganishajikwa umeme nchini kote. ili kuongeza kiwango cha matumizi ya umeme,gharamayaumemelazimaiwenafuukwawateja.Kuafikialengo hili, serikali kwa niaba ya KetRAco imeendelea kutafuta na kupata fedha zilizo na masharti nafuu kutoka kwa Washirika wetu wa maendeleo ili kupanua gridi ya taifa. Aidha, Kampuni inafanya kazi na huduma za kikanda za matumizi ya nguvu ya umeme ili kuharakisha uunganishaaji, kusudi kupata nguvu ya umeme iliyonafuukwanjiayabiasharayanguvuyaumeme.

TATHmini yA uTenDAJi

Vitengo vya umeme uliosambazwa kupitia kwa njia ya lainizinazomilikiwa na KetRAco katika mwaka wa fedha wa 2010/2011 vilikuwa masaa ya kilowati 364,000,000 (kWh). hii ilikuwa ni ongezeko kutoka kWh 340,460,000 za usambazajimwaka uliotangulia. Jumla ya mapato yalifikia KShs. 940 milioniikilinganishwa na Kshs. 647 milioni mwaka wa 2009/2010, wakati jumla ya gharama ya utendaji kazi kwa kipindi hicho ilikuwa niKshs. 461 milioni, ikilinganishwa na Kshs. 223 milioni kwa mwaka uliotangulia. Mapato ya ziada kwa ajili ya mwaka kabla ya kodiyalikuwa Kshs.480 milioni ilhali mapato halisi ya ziada yalikuwa Kshs. 422 milioni. hii inalinganishwa na mapato ya ziada kabla ya kodi ya Kshs. 424 milioni na mapato halisi ya ziada Kshs. 389 milioni kwa kipindi kilichotangulia.

mali yalilikua kutoka Kshs. 8,761,000,000 mwaka wa 2010 hadi Kshs. 18,986,000,000, ongezeko la 117% ambalo ni la kupongezwa.

mTAzAmio wA BAADAye

Kampuni imeanzisha mpango kabambe wa kupanua miundombinu yamtandaowausambazajiwaumeme. Kukiwana laini zaidi zausambazajiwaumemezikikamilishwanakufunguliwa, inatarajiwakwamba kiwango cha vitengo vya umeme vitakavyo sambazwa kitazidikuongezekamaradufu,nakuimarishamauzoyetu.Pamojana kuendelea kuungwa mkono na serikali na Washirika wetu wa

Maendeleo, miradi ya miundombinu ya usambazaji iliyopangwaitatekelezwa kikamilifu na hii itasaidia sana katika utekelezaji wadira ya Kenya 2030.

sHukrAni

mimi, kwa mara nyingine tena, ningependa kutoa shukrani zangu za dhati kwa Bodi ya Wakurugenzi, usimamizi, wafanyakazi, serikali, na hasa Wizara ya nishati na Wizara ya Fedha, na washirika wetu wa maendeleo na wa biashara, kwa kuendelea ushirikiano wao na sisi,ambaoumewezeshwaKETRACOkufikiahatuakubwakatikakipindi hiki.

Ninatarajiakuendeleakupokeaushirikianowenu.

Mr. JusTus G. KAGEEnumwenyekiTi

8th January, 2012

Mojawapo ya minara ya kimo cha mita 35 ya laini ya 400kV ya mradi unaoendelea wa Mombasa-Nairobi, karibu na eneo la Voi.

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overview

itisyetanotherjoyousoccasionformetopresentanoverviewof the operating performance of KetRAco for the period ended 30th June, 2011.

the company embarked on an ambitious program to expand electricity transmission network infrastructure through continued implementation of projects which were commenced in thepreviousyearandothernewprojectsinitiatedintheperiodunderreview.

other programs that were initiated during the year included increasing human resource capacity and improving the work environment, installation of a backbone ict infrastructure, review of existing legal and regulatory frameworks, management of corporate risk, review of corporate governance framework and introduction of service delivery mechanisms.

eleCTriCiTy TrAnsmission FrAsTruCTure ProJeCTs the electricity sector in Kenya has for a long time been beset with challenges of inadequate generation capacity, constrained supply, limited transmission and distribution capacity leading to high losses in the transmission and distribution network. in pursuit of its mandate which is to plan, design, construct, operate and maintain new high voltage (132kv and above) electricity transmission infrastructure, the company is developing a new and robust national grid system to redress this situation. in this regard, anumberofprojectsareplannedforimplementationintheshortand medium term which fall under the following categories:-

i) Projectsthatwillincreaseaccessandaddressthechallenge of low penetration and low connectivityii) Systemstrengtheningandcapacityenhancementprojects that address the challenge of low voltages, high transmission losses, unreliability of supply and network securityiii) Projectsthatwillhelpevacuatepowerfromgenerationsites to demand centresiv) Regionalpowerinterconnectionprojectswithneighbouring countries that aim to stabilize power supply by enabling power trade.

i. eleCTriCiTy ACCess ProJeCTs

in order to increase access and address the challenge of low penetrationandlowconnectivity,variousprojectsareplannedforimplementation under the energy Access scale-up program. the projectsunderthisprogramareasfollows:

(a) kenya electricity expansion Project - world Bank funded

this is an electricity expansion program that covers generation, transmission and distribution. the 132kv

eng Joel m. kiilu – mAnAging

diRectoR & ceo

“Other programs that were initiated during the year included increasing human resource capacity and improving the work environment, installation of a backbone ICT infrastructure, review of existing legal and regulatory frameworks, management of corporate risk, review of corporate governance framework and introduction of service delivery mechanisms.”

Report of the managing director & ceo

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transmission lines and their associated sub-stations that fall under the transmission component are;- (i) 250 km Kindaruma- mwingi- Garissa (ii) 60 km eldoret- Kitale (iii) 44 km Kisii- Awendo

(b) Power Transmission system improvement Project - AfDB

funded

Thepowertransmissionsystemimprovementproject involves construction of 132kv lines and associated substations.Transmissionlinesfundedunderthisprojectare:- (i) 79 km nanyuki- nyahururu (ii) 65 km lessos- Kabarnet (iii) 68 km olkaria- narok (iv) 33 km sotik-Bomet (v) 153 km mwingi- Kitui- Wote- sultan hamud (vi) 33 km ishiara- Kieni

(c) Transmission system improvement projects - Belgium

government funded

132kv transmission lines that fall under this program are: (i) 67 km Kilimambogo- thika- Githambo (17 km double

circuit and 50 km single circuit) (ii) 20kmThika-Nyaga(Kiganjo) (iii) 96 km nanyuki-isiolo- meru

(d) Transmission system Project - government of kenya

funded

the Government is directly funding the 34 km mumias- Rangala 132 kv transmission line.

ii. sysTem sTrengTHening ProJeCTs

The System Strengthening Projects are meant to strengthentransfer capacity of the national grid. these include:-

(i) 320 km Rabai- malindi-Garsen-lamu 220 kv single circuit line which is envisaged to connect lamu port to the national Grid and strengthen supply to north coast. this has been financed by EXIM Bank of China and Government ofKenya(GoK).

(ii) 475 km mombasa-nairobi 400 kv double circuit line that will increase power transfer capacity between the coast and Nairobi. It’sfinancedbyAfricanDevelopmentBank(AfDB),Agence Française de développement (AFd), european

investment Bank (eiB) and GoK.(iii) 100kmNairobiRing400kVprojectthatwillincreasepower

transfercapacityandincreasereliabilitywhichwillbefinancedby AFd, eiB and GoK.

(iv) 300 km olkaria-lessos-Kisumu 220 kv double circuit transmission line to be financed by Japan Internationalcooperation Agency (JicA) that will evacuate supply from olkaria Geothermal power plant and strengthen the link between regions east and West of the Rift valley.

iii. Power evACuATion ProJeCTs

these transmission lines will evacuate power from generation stations and transfer to load centres:-

(i) 430 km loiyangalani- suswa 400kv double circuit line (ii) 25 km olkaria-suswa 220 kv two double circuit lines implemented through KenGen. (iii) 5 km sondu-sangoro 132 kv double circuit line implemented

through KenGen.

iv. regionAl inTerConneCTion ProJeCTs

three Regional interconnectors namely; Kenya-ethiopia (eastern Africa interconnector); lessos-tororo and isinya-Arusha-singida (Kenya- tanzania- Zambia) have been planned as detailed below.

(i) 612 km ethiopia- suswa (Kenya – ethiopia interconnector) 500kVHVDClinethatwillbefinancedbyWorldBank,AfDB,AFDandGoK.Thisprojectwill allow for importofpowerinitially of 400mW with a capacity to increase to 2,000mW into Kenya from ethiopia. the line will also be used to supply other neighbouring countries.

Minister for Energy, Hon. Kiraitu Murungi receives KETRACO’s

contribution towards the 2nd National Energy Conference from MD & CEO , Eng. Joel Kiilu


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(ii) 100 km isinya- Arusha– singida (Kenya- tanzania- Zambia interconnector) 400 kv double circuit line that will provide a link to the east African power pool with the south African power pool

(iii) 127 km lessos - tororo (Kenya- uganda interconnector) 220kVdoublecircuit linebeingfinancedbyAfDBthatwillserve as an anchor to interconnection within the Great lakes region. this will facilitate regional power trade among the countries in the Great lakes region.

the interconnectors once complete will create a regional market for power trade thus stabilizing quality and supply of power in the region.

PrOJECTs iMPLEMEnTATiOn At the beginning of the financial year, construction works forfive lineswas ongoing.These are:-Kilimambogo-Thika-Githambo,mumias-Rangala, Rabai-malindi-Garsen-lamu, mombasa-nairobi andThika-Nyaga.Atthecloseoftheyear,alltheprojectswereatdifferent stages of implementation.

in addition, the company commenced the process of implementing otherprojectsnamely;Loiyangalani-Suswa;Suswa-Isinya;Olkaria-lessos-Kisumu; Kindaruma-mwingi-Garissa; eldoret-Kitale; Kisii-Awendo; meru-isiolo-nanyuki; ishiara-Kieni-embu and nairobi Ring.Otherprojects that commencedduring theperiodwere;nanyuki- nyahururu; lessos- Kabarnet; olkaria- narok; Bomet- sotik; and mwingi- Kitui- Wote- sultan hamud. A detailed report onimplementationofeachoftheprojectsisgivenherebelow.

67 km kilimambogo- Thika- githambo 132kv line

the line is 17 km double circuit 132kv from Kilimambogo to thika and 50 km single circuit transmission line from thika-Githambo with two 23 mvA 132/33kv substations at thika and Githambo. in the year under review, 62 km of way-leaves were acquired, foundations casting for 89 towers completed, 55 towers erected and20 kmof conductor strung.Theproject is expected tobecompleted by march, 2012.

20 km Thika- nyaga 132kv line

this 132kv single circuit line is a 20 km extension of Kilimambogo-Thika-Githambowitha23MVA132/33kVatKiganjo.12kmofway-leaves have been acquired and 7 towers cast during the year. TheprojectisexpectedtobecompletedbyMarch,2012.

34 km mumias- Rangala 132kv line

The project entails construction of a 132 kV single circuit linewith two 23 mvA, 132/33kv substation at mumias and Rangala with six (6) 33kv feeder bays. Way-leaves acquisition has been completed for 29 km, engineering designs finalized and towerspottingcompletedduringtheperiodunderreview.Theprojectisexpected to be completed by march, 2012.

475 km mombasa- nairobi 400/220kv line

TheMombasa-Nairobi project involves construction of 400kVdouble circuit line from mombasa to nairobi with substation extension works at Rabai and embakasi. during the year, route survey was completed, way-leaves acquired for 455 km, designs finalizedandtowerspottingcompleted.Theproject isexpectedto be completed by march, 2013 and is on schedule

320 km Rabai- malindi- Garsen- lamu 220kv line

The project entails construction of a 220kV single circuit linefrom Rabai through malindi, Garsen to lamu with three 23 mvA substations at malindi, Garsen, and lamu. during the year, esiA report was completed and submitted to nemA, route survey progressed, 155 km of way-leaves and land for Garsen substation was acquired and a consulting engineer engaged.Theproject isexpected to be completed in december , 2012.

430 km loiyangalani- suswa 400kv line

This project involves construction of a 400kV double circuittransmission line from loiyangalani to suswa with 400kv substation at loiyangalani and 400/220kv substation at suswa. the line will evacuate 300mW of power from lake turkana Wind power plant to suswa substation. Route survey has been completed, way-leaves acquired for 120 km and an epc contract initialled. the construction of the line is scheduled to commence in April, 2012 and is expected to be completed 23 months later in march 2014.

nairobi Ring and substations

Thescopeof theprojectentailsconstructionof100km Isinya-suswa 400kv double circuit transmission line and six 220/66kv substations. the substations will be constructed at ngong, Athi River, suswa, isinya, Koma Rock and thika Road. A draft feasibility study was competed during the year under review. A consulting engineer has been engaged, draft esiA and RAp reports completed


CHemosiT - kisii 132 kv tRAnsmission line

21

22


andbiddocumentsforthemaincontractcompleted.Theprojectis expected to be completed by december 2013.

250 km kindaruma - mwingi- garissa 132kv line

Theprojectwillinvolveconstructionofa132kVsinglecircuitlinefrom Kindaruma to Garissa via mwingi with a 7.5mvA, 132/33kv substation at mwingi and a 7.5mvA, 132/33kv and 7.5mvA, 132/11kv substation at Garissa. 69 km of line route has been surveyed, way-leaves consents for 52 km signed. Acquisition of the substation land is on-going.The project is expected to becompleted by december, 2013.

60 km eldoret- kitale 132kv line

the eldoret to Kitale 132kv single circuit transmission line will have a 23 mvA, 132/33kv substation at Kitale. 40 km of line route survey has been completed, bid documents finalized andprocurementofcontractorisatanadvancedstage.Theprojectisexpected to be completed by december, 2013.

44 km kisii- Awendo 132kv line

The project will involve construction of a 132kV single circuittransmission line from Kisii to Awendo and a 23 mvA, 132/33kv substation at Awendo. Route survey has been completed and tendering for main contractor was initiated during the year. the projectisexpectedtobecompletedbyDecember2013.

300 km olkaria- lessos- kisumu 220 kv line

Theprojectwillentailconstructionofa220kVdoublecircuitlinefrom olkaria through lessos to Kisumu.. Route survey has been completedandanengineeringconsultantprocured.Theprojectisexpected to be completed by december 2014.

65 km lessos- kabarnet 132kv line

The project will involve construction of a 132kV single circuittransmission line from lessos to Kabarnet and a 15mvA, 132/33kv substation at Kabarnet. Route survey was completed for the entire linerouteduringtheperiodunderreview.Theprojectisexpectedto be completed by June 2014.

96 km nanyuki- nyahururu 132kv line

This project involves construction of a 132kV single circuittransmission line from nanyuki to nyahururu and a 23mvA, 132/33kv substation at nyahururu. Route survey was completed. TheprojectisexpectedtobecompletedbyJune2014.

68 km olkaria- narok 132kv line

the olkaria to narok line entails construction of a 132kvsingle circuit transmission line and a 23mvA 132/33kv at narok. Route survey was completed and esiA for narok substation forwarded toNEMAforissuanceofthelicence.Theprojectisexpectedtobe completed by June 2014.

33 km sotik- Bomet 132kv line

the Bomet to sotik line will entail constructing a 132 single circuit transmission line and a 23mvA 132/33kv at Bomet. Route survey for the line and esiA/RAp for the substation was completed during theyearunderreview.Theprojectisexpectedtobecompletedby June 2014.

153 km mwingi- kitui- wote - sultan Hamud 132kv line

This project involves constructing a 132kV single circuittransmission line from mwingi through Kitui, Wote to sultan hamud with four 15mvA, 132/33kv substations at Kitui, Wote, and sultan hamud. during the period under review, 35 km of route survey was completed. The project is expected to becompleted by June 2014.

33 km ishiara- kieni 132kv line

construction of a 132kv single circuit transmission line from ishiara to Kieni and a 23mvA, 132/33kv substation at Kieni are the maincomponentsunderthisproject.Routesurveywascompletedduring the period under review.The project is expected to becompleted by June 2014.

96 km nanyuki- isiolo-meru-132kv line

The project involves construction of a 132kV single circuittransmission line from nanyuki through isiolo to meru and construction of a 23mvA, 132/33kv substation at isiolo and installation of an additional 23mvA, 132/33kv transformer at meru. Route survey on 59km has been completed and an epc contractorselectedforthemaincontract.Theprojectisexpectedto be completed by April 2014.

127 km lessos- tororo interconnector 220kv line

TheprojectconnectsKenyatoothercountriesintheGreatLakesregion through uganda transmission network and will involve construction of 127 km, 220kv double circuit transmission line from lessos to tororo with two 75mvA, 220/132kv substation at lessos. during the year under review, route survey was


23


completed, esiA variation licence renewed and evaluation of technicalproposalsforfinalRAPcompleted.

612 km ethiopia - kenya interconnector

TheprojectseekstolinkthetransmissionnetworkinEasternAfricathrough construction of a 500kv hvdc bipole transmission line running from sodo in ethiopia and terminating at suswa in Kenya where a 2,000mW converter/inverter station and a 400/220kv substation will be built. during the period under review, draft report on optimum line route was completed, and a draft RAp report received.

100 km isinya - Arusha - singida 400kv line

The project, also referred to as Kenya-Tanzania-Zambiainterconnector, will link the network in Kenya to the south African power pool through construction of a 400kv double circuit transmission line from isinya to Arusha. Feasibility studies have commenced.

OThEr AChiEVEMEnTsAn enabling organization structure and work environment is a prerequisite to the company delivering on its mandate. in this regard, KetRAco embarked on review and strengthening of the existing frameworks in order to align them to its corporate strategy. important milestones which were attained are enumerated here below.

• Human resource Development

While recognizing that human resource is the fundamental resource that drives performance and delivery of corporate objectives,ithasbeenKETRACO’sendeavourtoensurethateachand every employee adds value and is properly placed within the organisation.

in order to strengthen the human resource, an internal skills and competence assessment was carried out and gaps identifiedand addressed. Additional staff were recruited during the year,

As part of capacity building, KETRACO has recruited 20 Graduate Engineers who will help achieve the ambitious 5000 kilometres of new transmission lines across the country. They are seen here training at the KPLC Training School before proceeding to India for advance training.


24


leading to increase in the staff complement from 62 to 107 at the close of the year. in order to improve skills and competencies, staff attended workshops, seminars, and specialised courses both locally and abroad. under the framework of the existing mou, our twenty newly recruited engineers undertook six months’ induction training in Kenya power. in partnership with the World Bank, powerGrid of india trained the same graduate engineers in transmission design and engineering for a period of ten weeks in india.

Government training institute (Gti) mombasa consultants also carried out a survey that analysed training and professional development. the company implemented the recommendations of the survey and competency development level increased from 57.6% to 62.7%. A comprehensive job evaluation exercise iscurrently under way.

in order to optimize on employee potential, the company undertook activities to improve on the working environment. Requisite furniture, fittings, tools and equipment both for thefieldandofficestaffwereprovided.Additionalvehicleswerealsopurchased to ensure adequate transport.

the company complied with its safety, health and environment (she) policy and the occupational safety & health Act. there is a medical insurance scheme in place to enhance health care for staff. staff team building activities were undertaken as well. An employee satisfaction baseline survey carried out at the beginning of the year had revealed an employee satisfacation index of 71.7% while the satisfaction survey undertaken at the close of the year revealed the satisfaction index had risen to 77%.

• Automation of operations

the company is committed to building and investing in world-class modern ict enabled infrastructure in order to enhance itsoperationsandservicedelivery.Towardsthisobjective,allthetransmission lines have been designed incorporating 48 core optical pilot Ground Wire (opGW) to facilitate the use of supervisory control & data Acquisition and energy management Systems(SCADA/EMS)forautomatedoperations.Excessfibreswill be leased to service providers.

A fully equipped server room was set-up with clean power, close controlairconditioningandhumiditycontrol,afiredetectionand

suppressionsystemandananti-staticraisedfloorforcoolingandcable management. it houses two racks which hold various servers, cisco call management equipment and software, switches, a Ciscofirewall,aninternetrouter,avoicegatewayrouter,aStorageArea network (sAn) and upses desktop and laptop computers, servers and security solutions were purchased and installed. For internal and external communication, a corporate intranet was operationalized and a website developed which is updated on a regular basis. internet availability has been at 98% as per the internet service provider’s service level agreement.

A comprehensive ict policy and procedures document which seeks to guide ict staff and users of information and ict resources on appropriate standards to be adopted at KetRAco was developed and to enhance security of ict, a policy on computer usage and passwords was issued to staff. ups were also installed for all desktop users. to enhance security in the premises, ip Access control was implemented and proximity cards were issued to all staff and ip cctv with web access view of camera feeds installed.

A Geographical information system (Gis) called ArcGis was implemented for analysis and geoprocessing of aerial survey data (liddAR), cadastral and other transmission line route data thus improving functional efficiency. A temporary financial solution,microsoft Gp dynamics was also implemented. Fuel cards and a Gps system were introduced for monitoring motor vehicles operations. The Company having identified the need for anintegrated management solution commenced the process of procuring an enterprise Resource planning (eRp) solution.

• Performance management

Performancemanagement is critical to realizationof objectives.the company made efforts to streamline and institutionalize performance management across the organization through design and implementation of a performance monitoring, evaluation and reporting framework. A monitoring and evaluation committee was formed which met regularly to discuss the reports and make recommendations. As part of broader public sector reforms introduced by theGovernment to instil efficiency andeffectiveness in management of public services, the company signed its second performance contract for 2010/2011 between the Board and Government which was cascaded to the divisions/departments. in the annual evaluation for 2010/11, the company


25

the KenyA electRicity tRAnsmission compAny limited

memBeRs oF tHe BoARd duRinG inspection touR oF momBAsA - nAiRoBi

tRAnsmission line cuRRently undeR constRuction

26


achieved a total weighted score of 2.4523 and its performance wasratedas“VeryGood”.

• Compliance with legal and regulatory Framework

the company adheres to good corporate governance practice. the company complied with all statutory obligations including tax remittances and deductions for nssF, nhiF & helB were made. during the year, a code of conduct was developed and is under implementation while preparation of a Board manual and charter to guide Board operations is underway. in order to havea frameworkforwheelingagreementsandensurefinancialsustainability, draft wheeling and o&m term sheets were prepared.

• management of Corporate risk

the company undertook measures to manage risk that may arise in the course of doing business. A Board Audit and Risk committee is in place and held four meetings during the year. A Risk management committee was formed consisting of heads of departments which provides operational support to Board committee. Risk assessment for all the departments was conducted and top twenty risks identified for management attention. Aconsultantwas identifiedandcontractedtoprovideconsultancyservices for development of enterprise Risk management (eRm) framework. to mitigate on external risks, insurance cover was taken for all company assets including movable assets and human capital. A legal audit of company operations and on-going contracts was carried out during the year under review.

• research and Development Policy

in recognition that Research & development holds the key to solving the challenges that hamper the development of network infrastructure, the company reviewed the Research & development (R & d) policy. the R & d policy will guide research efforts in the electricity transmission services within the company undertaken by staff or other partners. A draft research paper on cost effective electricity transmission technology was prepared that will be used in conducting a baseline survey.

• iso Certificationin order to streamline its business systems and procedures, the Companyhad commencedon the ISOCertificationprocess inthe previous year and during the year under review, significantprogress was made towards ISO certification. Specifically theCompany drafted the Quality Policy Objectives and Manual.A

consultant to guide the company in the process was contracted and an inception report received. staff members have been sensitized on iso, GAp analysis carried out and operational proceduresdocumentedandvalidated.Bytheendofthefinancialyear,70%oftheISOcertificationprocesshadbeenachieved. • Hiv/AiDs at the work place

in recognition of the possible impact hiv/Aids can have in the work place for victims and other employees, the company carried out hiv/Aids awareness campaign workshops for employees and continued providing condoms through dispensers in all washrooms while a hiv/Aids baseline survey was conducted. A report was submitted by the consultant and will inform activities on hiv/Aids issues in the company.

• Drugs and substance issues at the work place

drugs and substance abuse can have a detrimental effect on employee performance and in order to mainstream drugs & substance issues in the company, sensitization was undertaken through workshops and publicized on posters displays. A drugs and substance baseline survey was conducted during the year and a report submitted by the consultant. its recommendations are under implementation.

• gender and Disability mainstreaming at the work place

in order to address gender-based issues in the work place, gender mainstreaming was done through collection of gender desegregated data and sensitization of employees through workshops. Gender parity was maintained during recruitment by implementing Government’s gender policy in the public service. in addition, disability mainstreaming was carried out through awareness workshops for staff to make the work place friendly to people with disabilities.

• integrity measures

in continuing efforts towards good corporate governance, the company undertook measures that would enhance integrity at the work place. the integrity committee was operationalized, members sensitized on integrity testing and a programme Officerappointed.Inaddition,twostaffmembersweretrainedasIntegrityAssuranceOfficers(IAOs).Othermembersofstaffweresensitized in an integrity workshop facilitated by ethics & Anti-corruption commission (eAcc). copies of the Anti-corruption and Economic CrimesAct, 2003, the PublicOfficer EthicsAct,


27


2003 and the public service commission code of conduct and ethics were distributed to staff. the company drafted Gift & BenefitandConflictofInterestPoliciesandAnti-FraudandFraudResponse policy. Quarterly reports were submitted to KAcc. A corruption perception baseline survey was undertaken and a report submitted which revealed a baseline index of 16.5% that indicates a low perception of corruption in KetRAco.

• service Delivery Charter

during the year, the service delivery charter was reviewed to make it more user- friendly. dissemination of the service charter was made through distribution to stakeholders and displays positioned at strategic locations within KetRAco premises. the company undertook to implement its activities by complying with the provisions in its service delivery charter. A customer satisfaction baseline survey was conducted at the beginning of the year which had shown an index of 64.74% while a survey conducted at the end of the period showed a customer satisfaction index of 71.90%.

• service Delivery innovations

the company in realization that innovation is the driver of growth introduced a service delivery innovation involving use of liddAR technologythatsimplifiestheprocessofroutesurveyandmakesway-leavesacquisitionmoreefficient.

• resolution of Public Complaints

during the year, the company made several efforts towards resolution of public complaints in continuation of the previous year’s initiatives. complaints handling procedure was prepared and communicated to staff. A complaints desk was established and a PublicComplaintsDeskOfficerappointed.Dedicatedtelephonelines and email address were made available for receiving public complaints. Four (4) quarterly reports were submitted to the Public Complaints Standing Committee and a certificate wasissued to the company.

corporate social Responsibility

KetRAco has a corporate social Responsibility policy that

A landowner affected by the construction of the Rabai-Malindi-Garsen-Lamu shows a plan of a new house during a monitoring & evaluation tour by some members of Board of Directors and Management of KETRACO.


28


guides its operations. in line with this policy, and as a responsible corporate citizen, the company continues to engage in various activities that ensure that its operations are responsible socially, environmentally and ethically. in particular, we also engage in supporting industry and sector initiatives aimed at ensuring capacity building, best practices and sustainability.

KetRAco also ensures that its operations are carried out observing humane and best practices taking into account that construction of transmission lines may involve outright acquisition of land and/or wayleaves access, , which may disrupt way of life of theprojectaffectedpersons.KETRACOensuresthatallprojectsare carried out through a consultative process with stakeholders. in carrying out its operations KetRAco complies with the provisions of its service charter.

in fulfilling its Csr commitment, the Company:

• endeavours to implement projects in compliance with all

applicable legal, regulatory safety, health and environmental requirements;

• seeks to partner with stakeholders in appropriate community development programs within the laid down procedures;

• ensures that our contractors use sustainable processes, and materials that avoid adverse effects on air, water and soil and maintain the environmental health of the communities in which we operate; and

• encourage staff- driven charity & voluntary work.

Focus AReAs

Due to the nature of operations and projects implemented infar-flungareas,KETRACOwillendeavourtoadoptanintegratedapproach to ensure that during project conception, societaland environmental concerns particularly those encompassing: education; health; Water; Rural lighting; environment; culture, sports & Recreation; and capacity Building are embraced.

Malindi DC is assisted by Mr. Yao of CAMCE, the EPC Contractors of the Rabai-Malindi-Garsen-Lamu line during the handover ceremony of a classroom block donated by the CAMCE to the local Gede Community


29


During the year KETRACO engaged in the following specificactivities:

• building of a classroom block for Gede community in partnership with the contractor for Rabai-malindi-Garsen-Lamuproject;

• sponsored and participated in the 2nd national energy conference;

• supported the planned turkwell peace race, an event which endeavours to bring peaceful co-existence communities in the north rift; and

• donated clothing, bedding materials to the victims of the sinai Fire disaster through staff initiatives.

KetRAco understands that the actions and conduct of each of its employees, contractors and its other agents are the basis upon which our stakeholders will evaluate our commitment to achieving the highest standards of corporate social responsibility as we implement our core mandate.

going ForwArD

the company will continue to discharge its core mandate of development and operation of grid network infrastructure


towards the realization of the nation’s vision 2030. it will continue to maintain an environment which values its customers, shareholders, development partners, customers, employees, suppliers, local communities, the public and other stakeholders. With continued support of the Government, the Board of directors, staff, customers, suppliers and other stakeholders and deepening our culture of teamwork, professionalism, creativity, innovation and commitment, we promise to deliver on our vision.

EnG. JOEL KiiLumAnAGinG diRectoR & ceo

8th January, 2012

Staff of KETRACO donating blankets for the Sinai Fire Tragedy Victims at Tom Mboya Hall off Jogoo Road in Nairobi

30


muHtAsARi

ni fursa nyingine ya furaha kwangu kuwasilisha muhtasari wautendajikaziwaKETRACOkwakipindikilichomalizikatarehe 30 Juni, 2011.

Kampuni iliaanzisha mpango kabambe wa kupanua miundombinu zamtandaowausambazajiwaumemekwakendelezautekelezajiwa miradi iliyoanzishwa mwaka uliotangulia, na pia miradi mingine mipya iliyoanzishwa katika kipindi cha mwaka unaoangaziwa.

Mipangomingine ambayo ilianzishwamwaka huo ni pamoja nakuongeza uwezo wa rasilimali watu na kuboresha mazingira ya kazi, sakinishoyamiundombinuzaTeknolojiayaHabarinaMawasiliano(ict), tathmini ya mifumo zilizopo za kisheria na udhibiti, usimamizi wa hatari katika Biashara, tathmini ya mfumo wa uongozi wa shirikanakuanzishwakwautaratibuwautoajiwahuduma.

eng Joel m. kiilu

mKuRuGenZi mKuu nA piA AFisA mtendAJi mKuu

“Mipango mingine ambayo ilianzishwa mwaka huo ni pamoja na kuongeza uwezo wa rasilimali watu na kuboresha mazingira ya kazi, sakinisho ya miundombinu za Teknolojia ya Habari na Mawasiliano (ICT), tathmini ya mifumo zilizopo za kisheria na udhibiti, Usimamizi wa Hatari katika Biashara, tathmini ya mfumo wa uongozi wa shirika na kuanzishwa kwa utaratibu wa utoaji wa huduma”

RipotiyaMkurugenziMkuunapiaAfisaMtendajiMkuu

mirADi yA miunDomBinu yA usAmBAzAJi wA nguvu

yA umeme

sekta ya nguvu ya umeme nchini Kenya kwa muda mrefu imekuwa inakabiliwanachangamotozauwezoduniwautendajikazi,vikwazovyaugavi, uwezomdogowausambazaji naugaviunaosababishahasarakubwakatikausambazajinakatikamtandaowaugavi.Katika kutekeleza azma ya mamlaka yake ambayo ni ya kupanga, kubuni, kujenga, kuendesha na kudumisha miundombinu yausambazajiwaumemewavoltikubwa(132kVnazaidi),Kampuniinabuni gridi mpya ya kitaifa iliyo imara na madhubuti ili kurekebisha hali hii. Kahusiana na suala hili, idadi ya miradi ambayo imepangwa kutekelezwa katika muda mfupi na wa kati, ikiwa chini ya makundi yafuatayo: -

i) Miradiambayoitaongezaupatikanajinakukabilianana changamotozampenyonauunganishwajiwachini.ii) Kuimarisha mfumo na miradi ya kukuza uwezo ambayo itakabiliana na changamoto za volti ndogo, hasara za usambazajiwavoltikubwa,kutotegemekakwausambazaji na usalama wa mtandao.iii) miradi ambayo itasaidia kupokea nguvu kutoka vituo vya uzalishajihadimaeneoyamahitaji.iv) Uunganishajiwanguvuyaumemekatikakandahiipamoja nanchijiraniambazozinalengakuimarishautulivukatika nguvu ya umeme kwa kuwezesha biashara ya umeme.

i mirADi yA uPATikAnAJi wA umeme

Ilikuongezaupatikanajinakukabiliananachangamotozaupenyona uunganishaji wa hali ya chini, miradi mbalimbali imepangwakutekelezwa chini ya mpango wa Kuongeza na Kupenyeza umeme ( energy Access scale-up program). miradi chini ya mpango huu ni kama ifuatavyo:

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Wahandisi wanafunzi wakisimama kwa picha ya pamoja na Power Grid ya India na mameneja wa KETRACO mwanzoni mwa mafunzo yao nchini India.


(a) mradi wa upanuzi wa umeme nchini kenya -

unaofadhiliwa na Benki ya Dunia.

Huunimradiwaupanuziwaumemeunaohusishauzalishaji, ugavinausambazaji.Usambazajiwalainiya132kVnavituo husikaambavyovikochiniyasehemuyausambazajini;- i) Kilometa 250 Kindaruma-mwingi-Garissa ii) Kilometa 60 eldoret-Kitale iii) Kilometa 44 Kisii-Awendo

(b) mradi wa uboreshaji wa mfumo wa usambazaji wa

umeme - unaofadhiliwa na AfdB

MradiwaUboreshajiwaMfumowaUsambazajiwaUmeme unahusishaujenziwalainiya132kVnavituohusika.Lainiza usambazajizinazofadhiliwachiniyamradihuuni:- i) Kilometa 79 nanyuki-nyahururu ii) Kilometa 65 lessos-Kabarnet iii) Kilometa 68 olkaria-narok iv) Kilometa 33 sotik-Bomet v) Kilometa 153 mwingi-Kitui-Wote-sultan hamud vi) Kilometa 33 ishiara-Kieni

(c) mradi wa uboreshaji wa mfumo wa usambazaji wa

umeme - unaohifadhiliwa na serikali ya ubelgiji.

LainizaUsambazajiwaUmemeza132kVchiniyampango huu ni:

i) Kilometa 67 Kilimambogo-thika-Githambo (Kilometa 17 saketi ya pili na Kilometa 50 saketi ya kwanza)

ii) Kilometa20Thika-Nyaga(Kiganjo) iii) Kilometa 96 nanyuki-isiolo-meru

(d) mradi wa mfumo wa usambazaji wa umeme -

unaofadhiliwa na serikali ya kenya

SerikaliinafadhiilimojakwamojalainiyaUsambazajiwa umeme ya 132kv, Kilometa 34 mumias-Rangala.

ii mirADi yA uimArisHAJi wA mFumo wA usAmBAzAJi

wA umeme

MiradiyaUimarishajiwaMfumowaUsambazajiwaUmemeinadhamiriakuongezauwezowauhamishajiumemekwagridiyataifa.Hiinipamojana:i) Kilometa 320 Rabai-malindi-Garsen-lamu za laini ya 220 kv saketimojaambayoinakusudiakuunganishaBandariya LamukwaGridiyaTaifanakuimarishausambazajikwaPwani Kaskazini. mradi huu umefadhiliwa na Benki ya exim ya ChinapamojanaSerikaliyaKenya(GoK).ii) Kilometa 475 mombasa-nairobi za laini ya 400 kv saketi mbili ambayo itaongezea uwezo wa uhamisho wa nguvu ya umeme kati ya pwani na nairobi.

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mradi huu unafadhiliwa na Benki ya maendeleo ya Afrika (AfdB), Agence Française de développement (AFd), Benki yaUwekezajiyaUlaya(EIB)naSerikaliyaKenya,(GoK).iii) mradi wa Kilometa 100 nairobi Ring wa laini ya 400kv ambayoutaongezauwezowauhamishajiwanguvuya umeme na kuboresha kutegemewa ambao unafadhiliwa na AFd, eiB na serikali ya Kenya, (GoK).iv) Kilometa 300 olkaria-lessos-Kisumu za laini ya 220kv saketi mbiliyausambazajiunaofadhiliwanaShirikalaUshirikiano wa Kimataifa la Japani (JicA) ambalo litahamisha umeme kutoka olkaria Geothermal power plant na kuimarisha uhusiano kati ya sehemu ya mashariki na magharibi ya Bonde la ufa.

iii mirADi yA uHAmisHAJi wA umeme

Laini hizi za usambazaji wa umeme zitahamisha umeme kutokavituovyauzalishajihadisehemuzamahitaji:-i) laini ya Kilometa 430 ya loiyangalani-suswa ya 400kv ya saketi mbili.ii) laini ya Kilometa 25 ya olkaria-suswa ya 220kv ya saketi mbili inayotekelezwa na kampuni ya KenGen.iii) laini ya Kilometa 5 ya sondu-sangoro ya 132kv ya saketi mbili inayotekelezwa na KenGen.

iv. uungAnisHAJi wA mirADi yA kAnDA

Miradimitatuyauunganishajiwakandayaani;Kenya-Ethiopia(EastAfrica interconnector); lessos-tororo na isinya-Arusha-singida (Kenya-tanzania-Zambia) imepangwa na kina kama ifuatavyo:

(i) laini ya Kilometa 612 ya ethiopia-suswa (Kenya - ethiopia interconnector) ya 500kv ya hvdc ambayo itafadhiliwa na Benki ya dunia, AfdB, AFd na serikali ya Kenya, (GoK). Mradihuuutaruhusuuagizajiwanguvuyaumeme,ikianzia 400mW na ikiwa na uwezo wa kuongeza hadi 2000mW kuingia Kenya kutoka ethiopia. laini hiyo pia itatumika katika ugaviwaumemehadinchinyinginejirani.(ii) laini ya Kilometa 100 ya isinya-Arusha-singida (Kenya- tanzania-Zambia interconnector) ya 400kv ya saketi mbili na pia itaunganisha east African power pool na south African power pool(iii) laini ya Kilometa 127 ya lessos - tororo (Kenya-uganda interconnector) ya 220kv ya saketi mbili itakayofadhiliwa na AfdB na itakayotumika kama nanga ya ugavi wa umeme

katika kanda ya maziwa makuu. hii itaimarisha uwezo wakufanya biashara za nguvu za umeme miongoni mwa nchi katika kanda ya maziwa makuu.

Mara tu viunganishi vitakapokamilika, vitajenga soko la kikandala biashara ya umeme na hivyo basi uimarishaji wa ubora nausambazajiwaumemekatikakanda.

uTEKELEZAJi MirADiKatikamwanzowamwakawafedhaunaoangaziwa,ujenziwalainitano ulikuwa unaendelea. hizi ni:- Kilimambogo-thika-Githambo, mumias-Rangala, Rabai-malindi-Garsen-lamu, mombasa-nairobi na thika-nyaga. Katika mwisho wa mwaka, miradi yote ilikuwa katikahatuambalimbalizautekelezaji.

Aidha,Kampuniilianzamchakatowautekelezajiwamiradimingineikiwa ni: loiyangalani-suswa; suswa-isinya; olkaria-lessos-Kisumu; Kindaruma-mwingi-Garissa; eldoret-Kitale, Kisii-Awendo; meru-isiolo-nanyuki; ishiara- Kieni-embu na nairobi Ring. miradi mingine ambayo ilianza katika kipindi hicho ilikuwa ni: nanyuki-nyahururu, lessos-Kabarnet; olkaria-narok, Bomet-sotik, na mwingi - Kitui -Wote - Sultan Hamud. Taarifa kamili ya utekelezaji wa kilamojawapoyamiradihiiimenakiliwahapachini.

laini ya kilometa 67 ya kilimambogo-Thika-githambo ya 132kv.

laini ni ya Kilometa 17 ya saketi mbili ya 132kv kutoka Kilimambogo hadi thika na laini ya Kilometa 50 ya saketi mbili kutoka thika-Githambo ikiwa na vituo viwili vya 23 mvA 132/33kv kule thika na Githambo. Katika mwaka husika, tulipata haki za Kupita za kwenyemaliyabinafsizaKilometa62,ujenziwamisingiyaminara89 ikakamilika, minara 55 ikajengwa na Kilometa 20 za nyayakuunganishwa. Mradi huu unatarajiwa kukamilika mnamoMachi2012.

laini ya kilometa 20 Thika-nyaga ya 132kv.

Lainihii ya132kVya saketimojaniupanuziwaKilometa20zalaini ya Kilimambogo-thika-Githambo, ikiwa na kituo cha 23 mvA 132/33kVkuleKiganjo.HakizaKupitazaKilometa12zimepeanwanaminara7kujengwakatikamwakahuo.Mradihuuunatarajiwakukamilika machi, 2012.


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eQuipment in A suB-stAtion

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laini ya kilometa 34 ya mumias-rangala ya 132kv.

Mradihuuunahusuujenziwalainiya132kVyasaketimoja,ikiwana vituo viwili vya 23 mvA, 132/33kv kule mumias na Rangala navituovidogosita(6)vya33kV.UpatikanajiwaHakizaKupitaumekamilika kwa Kilometa 29, miundo ya uhandisi imekamilika na ugunduzi wa minara umekamilika pia katika kipindi husika. mradi huuunatarajiwakukamilikaMachi2012.

laini ya kilometa 475 ya mombasa-nairobi ya 400/220kv

Mradi wa laini yaMombasa-Nairobi unahusu ujenzi wa laini ya400kv ya saketi mbili kutoka mombasa hadi nairobi ikiwa na upanuzi wa vituo vya Rabai na embakasi. Katika mwaka huo, uchunguziwanjia ya lainiulikamilika,Haki zaKupita zikapeanwakwa Kilometa 455, miundo kukamilika na ugunduzi wa minara kukamilika.MradihuuunatarajiwakukamilikaMachi2013naukokatika wakati unaofaa.

laini ya kilometa 320 ya rabai-malindi-garsen-lamu ya 220kv

Mradihuuunahusuujenziwalainiya220kVyasaketimojakutokaRabai kupitia malindi, Garsen na lamu ikiwa na vituo vitatu vya 23mvA kule malindi, Garsen, na lamu. Katika kipindi cha mwaka, ripoti ya esiA ilikamilika na kuwasilishwa kwa nemA huku uchunguzi wa njia ukiendelea. Haki za Kupita za Kilometa 155na ardhi ya ujenziwa kituo chaGarsen ilinunuliwa namhandisimshaurikushirikishwa.Mradihuuunatarajiwakukamilikamweziwadesemba, 2012.

laini ya kilometa 430 ya loiyangalani-suswa ya 400kv

Mradihuuunahusuujenziwalainiya400kVyasaketimbilikutokaloiyangalani hadi suswa ikiwa na kituo cha 400kv kule loiyangalani na kingine cha 400/220kv kule suswa. laini itapeleka umeme wa 300mW kutoka mtambo wa lake turkana Wind power hadikituochaSuswa.UchunguziwanjiaumekamilikanaHakizaKupitaza Kilometa 120 kupeanwa, na pia mkataba wa epc umeanzishwa. Ujenzi wa laini umepangwa kuanza mwezi wa Aprili 2012 naunatarajiwakukamilikabaadayamiezi23mnamoMachi2014.

laini ya nairobi na vituo vya nairobi

WigowamradiunahusuujenziwaKilometa100kutoka Isinya-suswa za 400kv ya saketi mbili na vituo sita vya 220/66kv. vituo hivyo vitajengwa Ngong, Athi River, Suswa, Isinya, Koma Rockna thika Road. upembuzi yakinifu rasimu ulikamilika mwaka unaoangaziwa. mhandisi mshauri ameshirikiswa, Rasimu ya ripoti za esiA na RAp zimekamilika na hata nyaraka za zabuni ya mkataba

kuukukamilika.Mradihuuunatarajiwakukamilikaifikapomweziwadesemba 2013.

laini ya kilometa 250 ya kindaruma-mwingi-garissa ya 132kv

Mradi huu utahusisha ujenzi wa laini ya 132kV ya saketi mojakutoka Kindaruma hadi Garissa kupitia mwingi na kituo cha 7.5mvA, 132/33kv kule mwingi na vingine vya 7.5mvA, 132/33kv na 7.5MVA, 132/11kV kuleGarissa. Kilometa 69 za njia ya lainiimechunguzwa na haki za Kupita za Kilometa 52 kutiwa saini. Ununuziwaardhiyakujengahichokituounaoendelea.MradihuuunatarajiwakukamilikamnamoDesemba2013.

laini ya kilometa 60 ya eldoret-kitale ya 132kv.

Laini yaEldorethadiKitale ya132kVya saketimoja yaumemeitakuwa na kituo cha 23MVA, 132/33kV kule Kitale. Utafiti waKilometa40wanjiayalainiumekamilika,hukunyarakazazabunikukamilikanapiautafutajiwamkandarasiunaendeleaukiwakatikahatua ya mwisho. Mradi huu unatarajiwa kukamilika mnamodesemba 2013.

laini ya kilometa 44 km ya kisii-Awendo ya 132kv.

Mradi utahusisha ujenzi wa laini ya 132kV ya saketi moja yaumeme kutoka Kisii hadi Awendo na kituo cha 23 mvA, 132/33kv kuleAwendo.Uchunguziwanjiayalainiumekamilikanautoajiwazabuni kwa mkandarasi mkuu ulianzishwa mwakani. mradi huu unatarajiwakukamilikaifikapoDesemba2013.

laini ya kilometa 300 ya olkaria-lessos-kisumu ya 220kv.

Mradihuuutahusishaujenziwa lainiya220kVyasaketimbilizaumeme kutoka olkaria kupitia lessos na Kisumu. uchunguzi wa njiayalainiumekamilikanamhandisimshauriamepatikana.MradihuuunatarajiwakukamilikaifikapoDesemba2014.

laini ya kilometa 65 ya lessos-kabarnet ya 132kv.

Mradi huu utahusisha ujenzi wa laini ya 132kV ya saketi mojaya umeme kutoka lessos hadi Kabarnet na kituo cha 15mvA, 132/33kVkuleKabarnet.Uchunguziwanjiayoteyalainiulikamilikakatikakipindikinachoangaziwa.MradihuuunatarajiwakukamilikaifikapoJuni2014.

laini ya kilometa 96 nanyuki-nyahururu ya 132kv

Mradi huu unahusu ujenzi wa laini ya 132kV ya saketimoja yaumeme kutoka nanyuki hadi nyahururu ikiwa na kituo cha


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23MVA, 132/33kV kule Nyahururu. Uchunguzi wa njia ya lainiulikamilika.MradihuounatarajiwakukamilikaifikapoJuni2014

laini ya kilometa 68 ya olkaria-narok ya 132kv

Laini ya Olkaria hadi Narok inahusu ujenzi wa laini ya 132kVinayobeba saketi moja ya umeme ikiwa na kituo cha 23 MVA,132/33kVkuleNarok.UchunguziwanjiayalainiulikamilikahukuripotiyaESIAyakituochaNarokkupelekwakwaNEMAkwaajiliyautoajiwaleseni.Mradihuuunatarajiwakukamilika ifikapoJuni2014.

laini ya kilometa 33 ya sotik-Bomet ya 132kv

Laini ya Bomet hadi Sotik itahusisha ujenzi wa laini ya 132kVya saketi moja ya umeme na kituo cha 23MVA,132/33kV kuleBomet.UchunguziwanjiayalaininaripotiyaESIA/RAPyakituoulikamilika katika kipindi cha mwaka unaoangaziwa. mradi huu unatarajiwakukamilikaifikapoJuni2014.

laini ya kilometa 153 ya mwingi-kitui-wote - sultan Hamud ya

132kv.

Mradihuuunahusishaujenziwalainiya132kVyasaketimojayaumeme kutoka mwingi kupitia Kitui, Wote hadi sultan hamud na vituo vinne vya 15mvA, 132/33kv kule Kitui, Wote, na sultan Hamud.Wakati wa kipindi hiki, uchunguzi wa njia ya laini yaKilometa35ulikamilika.Mradihuuunatarajiwakukamilika ifikapoJuni 2014.

laini ya kilometa 33 ya ishiara-kieni ya 132kv.

Ujenziwalainiya132kVyasaketimojakutokaIshiarahadiKieninakituokimojacha23MVA,132/33kVkuleKienindivyovipengelevikuuvyamradihuu.Uchunguziwanjiayalainiulikamilikakatikakipindikinachoangaziwa.MradihuuunatarajiwakukamilikaifikapoJuni 2014.

laini ya kilometa 96 ya nanyuki-isiolo-meru ya 132kv.

Mradihuuunajumuishaujenziwa laini ya132kVya saketimojayaumemekutokaNanyuki kupitia IsiolonaMerunapiaujenziwa kituo cha 23mvA, 132/33kv kule isiolo na kuwekwa kwa transfoma ya ziada ya 23mvA , 132/33kv kule meru. uchunguzi wa njiayalainiyajuuyakilometa59kmimekamilikanamkandarasiwaEPCkuchaguliwakwaajiliyamkatabakuu.MradihuuunatarajiwakukamilikaifikapoAprili2014.

laini unganishi ya kilometa 127 ya lessos-Tororo ya 220kv

mradi huu unaunganisha nchi ya Kenya na nchi nyingine katika kandayaMaziwaMakuukupitiamtandaousambazajiwaumemewaUgandanautahusishaujenziwalainiyaKilomita127ya220kVya saketi mbili kutoka lessos hadi tororo ikiwa na vituo viwili vya 75mvA, 220/132kv kule lessos. Katika kipindi cha mwaka unaoangaziwa, uchunguziwanjia ya laini ulikamilika, huku leseniya esiA ya kufanya mabadiliko ilifanywa upya na tathmini ya mapendekezo ya kiufundi ya RAp ya mwisho kukamilika.


Kazi ya ujenzi wa kituo cha Thika cha 132kV ambacho ni sehemu ya mradi wa laini ya Kilimambogo-Thika-Githambo

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laini ya kilometa 612 km ya kiunganishi ethiopia-kenya

MradihuounalengolakuunganishamtandaowausambazajiwaumemekatikaAfrikaMashariki kupitia ujenziwa laini yaHVDCya 500kv aina ya bipole kutoka sodo nchini ethiopia hadi kule suswa nchini Kenya ambapo kituo cha mtambo wa kubadilisha umeme (converter/inverter) wa 2000 mW na kituo kidogo cha 400/220kVpiakitajengwa.Wakatiwakipindihiki,ripotirasimuyanjiaborayakupitishianakujengahiilainiilikamilika,naripotirasimuya RAp ilipokewa.

laini ya kilometa 100 ya isinya - Arusha - singida 400kv.

Mradi huu, pia unajulikana kama Kiunganishi Kenya-Tanzania-Zambia, utaunganisha mtandao wa umeme wa Kenya na ule wa SouthAfricaPowerPoolkupitiaujenziwalainiya400kVyasaketimbili ya umeme kutoka isinya hadi Arusha. upembuzi yakinifu umeanzishwa.

MAFAniKiO MEnGinEmazingira bora ya kufanyia kazi na muundo wa uongozi bora ni muhimu ili kuwezeshaKampuni kutoawajibuwake inavyostahili.Kuhusu suala hili, KetRAco ilianzisha kuimarisha mifumo ili kuiambatanisha na mikakati ya kampuni. hatua muhimu ambazo zilizoafikiwazimeorodheshwahapachini.

kuendeleza uwezo wa wafanyakazi

huku ikitambuliwa kwamba wafanyakazi ni raslimali ya msingi

ambayoinaendeshautendajinauafikiajiwamalengoyakampuni,KETRACO inajitahidi kuhakikisha kwamba kila mmoja wawafanyakaziwake anajiongezea thamani na kwamba amewekwamahali anapostahiki katika kampuni.

Ili kuimarisha wafanyakazi, tathmini ya ndani ya ujuzi na uwezoulifanywa na mapengo kutambuliwa na kushughulikiwa. Wafanyakazi waziadawaliajiriwakatikamwakanakusababishakuongezekakwaidadiyawafanyikazikutoka62hadi107kufikiamwishomwaka.

Ili kuboresha ujuzi na uwezo, wafanyikazi walihudhuria warsha,semina, na mafunzo maalumu huku nchini na pia nchi za ng’ambo. chini ya mkakati wa makubaliano yaliyopo, wahandisi wetu ishirini walioajiriwahivikaribuni,walipatamafunzoyamiezisitakuleKenyapower. Kwa kushirikiana na Benki ya dunia, powerGrid ya india ilifunza wahandisi hao katikamiundo ya usambazaji na uhandisikwakipindichamajumakuminchiniIndia.

Washauri wa taasisi ya mafunzo ya serikali (Gti) mombasa pia walifanya uchunguzi ambao ulichambua maendeleo ya mafunzo naukuajiwautaalamu.Kampuniilitekelezamapendekezoyahuoutafitiambayoyaliwezeshakiwangochauwezokuongezekakutoka57.6% hadi 62.7%.Zoezi la tathmini ya kina ya ajira inaendeleakwa sasa.

ili kuongeza uwezo wa mfanyikazi, Kampuni ilifanya shughuli za

Mwenyekiti, Bw. J. Kageenu akiungana na Mwenyekiti wa Kamati ndogo ya Malipo, Mchungaji (Dkt.) J. Mutura & mameneja waandamizi wakati wa kusahihisha Mkataba wa Utendaji na Katibu wa Kudumu wa Wizara ya Nishati, Bw. Patrick Nyoike.


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kuboreshamazingirayakufanyiakazi.Fanichazinazohitajika,zanana vifaa vya wafanyikazi wa ofisi na pia wa nyanjani vilitolewa.Magariyaziadapiayalinunuliwailikuhakikishausafiriwakutosha.Kampuni ilizingatia sera ya usalama, Afya na mazingira (she), na pia sheria ya usalama na Afya Kazini. Kuna mfuko wa Bima ya matibabu ili kuimarisha huduma za afya kwa wafanyikazi. shughuli za kuimarishaumojawakikundikwawafanyikazizilifanyikapia.Utafitiwa msingi wa kuridhika kwa mfanyikazi uliofanywa mwanzoni mwa mwakanaulionyeshafahirisiyakuridhikaya71.7%ilhaliutafitiwakuridhika kwa mfanyikazi uliofanywa wakati wa kufunga mwaka ulidhihirishakwambafahirisiimeongezekakufikia77%.

kufanya oparesheni kuwa otomatiki (moja kwa moja)

Kampuni ina nia ya kujenga na kuwekeza katika miundombinuyakisasayaTeknolojiayaHabarinaMawasilianoyakiwangochakimataifa, ili kuwezeshwa uimarishaji wa shughuli zake na utoajiwahuduma.Ilikuafikialengohili,lainizotezausambazajiumemezimeundwa kuchanganya nyaya 48 za aina ya optical pilot Ground Wire (opGW) ili kuwezesha matumizi ya Kudhibiti usimamizi na UpatajiDatanaMifumoyaUsimamiziwaNishati(SCADA/EMS)kwa ajili ya operesheni zamoja kwamoja au otomatiki. Nyuziziada zitakodishwa kutoka kwa Watoa huduma.

chumba cha Kompyuta tumishi kilicho na vifaa vyote kiliwekewa nishati safi, udhibiti kwa karibu, viyoyozi na unyevu, mfumowakutambua na kuzuia moto na sakafu dhidi ya tuli iliyoinuliwa kwa ajili ya kupoesha na utunzi wa nyaya. Chumba hicho kina rafumbili ambazo zinabeba Kompyuta tumishi mbalimbali, vifaa na programu za cisco za usimamizi wa Kupiga simu, swichi, ngome yaCisco,Kipanganjiachawavuti,Kichanganyishimtandaochasauti,mtandao wa storage Area (sAn), mitambo ya ups, komputa za aina ya mkononi na desktop, Kompyuta

tumishi na suluhu za usalama pia zilinunuliwa na sakinishwa. Kwa mawasiliano ya ndani na ya nje, wavutindani wa kampuniulianzishwa na tovuti iliundwa ambayo inayosasishwa mara kwa mara.Upatikanajiwaintanetiumekuwa98%kulingananaviwangovya huduma ya makubaliano ya Watoa huduma ya intaneti, isps.

Waraka waTaratibu na Sera ya kina yaTeknolojia ya Habarina mawasiliano (ict), ambayo inanuia kuongoza wafanyikazi na watumiaji wa raslimali za habari na Teknolojia ya Habarina mawasiliano kwa viwango vinavyo vinavyostahili, ambazo zitatumika katika kampuni ya KetRAco, ilibuniwa na kuongeza

usalamawaTeknolojiayaHabarinaMawasiliano;serayamatumiziya kompyuta na nywila zilitolewa kwa wafanyakazi. mitambo zaUPS pia zilisakinishwa kwawatumiajiwotewa kompyuta zadesktop.Ilikuimarishausalamakatikamajengo,DhibitiUfikivuyaitifaki ya Wavuti imetekelezwa na kadi za ukaribu zimetolewa kwa wafanyakazi wote, na cctv ya itifaki ya Wavuti na kamera za kwa mtandao na kamera za wavuti zimewekwa.

Mfumo wa Taarifa za Kijiografia (GIS) inayoitwa ArcGISumetekelezwa kwa ajili ya uchambuzi namchakatowa data yautafitiwaangani(LiDAR),lainizausambazajiwadatayacadastralhuelekezadata,nakwanjiahivyokuboreshaufanisiwakazi.Suluhula muda la kifedha liitwalo microsoft Gp dynamics pia lilitekelezwa. KadizamafutayapetrolinamfumowaGPSulianzishwakwaajiliyaufuatiliajiwashughulizamagari.Kampunibaadayakutambuahajayakuwanasuluhulausimamizijumuishi,ilianzishamchakatowaununuziwasuluhuyaUpangajiwaMatumiziyaRasilimali(ERP.

usimAmizi wA uTenDAJi

UsimamiziwaUtendajinimuhimukwautekelezajiwamalengo.Kampuniilifanyajitihadazakuboreshanakulainishausimamiziwautendajikotekatikashirikakwakubuninautekelezajiwamfumowaufuatiliajiwautendaji,tathmininamuundowautoajitaarifa.

KamatiyaUfuatiliajinaTathmini iliundwaambayo ilikutanamarakwamarailikujadilitaarifanakutoamapendekezo.Kamasehemuyamageuzi mapana katika sekta ya umma yaliyoanzishwa na serikali kwa kutia ubora na ufanisi katika usimamizi wa huduma za umma, KampuniilitiasainimarayapiliMkatabawaUtendajikwamwaka2010/2011 kati ya Bodi na serikali, ambayo pia ilifanyika katika idara zote. Katika tathmini ya kila mwaka ya 2010/11, Kampuni iliafikiajumlayaalama2.4523nautendajiwakeulikadiriwakama“VizuriSana”.

uzingATiAJi wA TArATiBu zA kisHeriA

Kampuni inazingatia mazoea mazuri ya usimamizi wa mashirika. Kampuniilizingatiamajukumuyoteyakisheriaikiwanipamojanakulipa ushuru na kodi kwa nssF, nhiF & helB. Katika mwaka huo,kanunizamaadilizilibuniwanazikochiniyautekelezaji,ilhalimaandalizi ya mwongozo wa Bodi na mkataba wa kuongoza shughuli za Bodi ukiwa unaendelea. ili kuwa na mfumo wa mikataba ya kurahisisha uendelevu wa kifedha, rasimu na waraka waOperesheninaUtunzajiuliandaliwa.


38


usimAmizi wA HATAri yA BiAsHArA

Kampuni ilichukua hatua ya kusimamia hatari zinazoweza kutokea katika hali ya kutekeleza shughuli zake. Kamati ya halmashauri na Kamati ya Kutathmini hatari imewekwa na huwa na mikutano minne katika mwaka. Kamati ya usimamizi wa hatari iliundwa ikijumuishaWakuuwaIdara,ambayoinatoamsaadawauendeshajikwa Kamati ya halmashauri.

tathmini ya hatari katika idara zote ilifanyika, na hatari ishirini za muhimu kutambuliwa ili kupewa kipaumbele na usimamizi. mshauri alitambuliwa na kupewa kandarasi ya kutoa huduma ya ushauri ili kubuni muundo wa usimamizi wa hatari katika Biashara (eRm).

Ili kupunguza hatari ya nje, bima ilichukuliwa kwa ajili ya maliyote ya Kampuni ikiwa ni pamoja na mali zinazohamishika nawafanyakazi. ukaguzi wa kisheria wa shughuli za Kampuni na mikataba inayoendelea ulifanyika katika mwaka unaoangaziwa.

seRA yA utAFiti nA mAendeleo

Kwa kutambua kwamba Utafiti na Maendeleo vinauwezo wakutatua changamoto zinazozuia maendeleo ya miundombinu wa mtandao, Kampuni ilifanyia mapitio Sera yake ya Utafiti naMaendeleo (R & D). Sera hiyo ya R & D itaongoza juhudi zautafitikatikahudumazausambazajiwaumemezinazofanywanawafanyakazi ndani ya Kampuni, au na washirika wengine.

Rasimuyajaridalautafitikuhusugharamamadhubutiyateknolojiaya usambazaji wa umeme ilitayarishwa, ambayo itatumika katikakufanyautafitiwakimsingi.

vyeTi vyA i.s.o.

ili kuboresha mifumo na taratibu za biashara zake, Kampuni ilikuwa imeanza utaratibu wa kupata vyeti vya iso mwaka uliotangulia. Kuna maendeleo makubwa ambayo yamepatikana katika kupokea vyeti vya iso. hasa, Kampuni ilichapisha rasimu ya sera na mwongozo wa ubora wa malengo. mshauri wa kuiongoza Kampuni katika huo utaratibu alipewa kandarasi, na ripoti ya mwanzo kupokelewa.

Wafanyakazi wamekwisha hamasishwa kuhusu iso, na uchambuzi waainayaGAPuliofanywanataratibuzauendeshajikaziukanakiliwanakudhiditishwa.Kufikiamwishowamwakawakifedha,70%yautaratibuwakupewavyetivyaISOilikuwaimeafikiwa.

ukimwi/vvu kATikA mAeneo yA kAzi

ili kutambua uwezekano wa athari ambayo uKimWi/vvu vinaweza kuwa nayo katika mahali pa kazi kwa wafanyikazi na waathiriwa, Kampuni iliandaa warsha na kampeni za uhamasisho kwa wafanyakazi, na ikaendelea kutoa mipira ya kondomu kwa kuiwekakwenyevyoowakatiwotehukuutafitiwakimsingikuhusuuKimWi/vvu kufanyika. Ripoti hiyo iliwasilishwa na mshauri, na itajulishashughulizamasualayaUKIMWI/VVUkatikaKampuni.

mADAwA yA kulevyA nA mAsuAlA yA uTumiAJi mBAyA

wA mADAwA kATikA mAHAli PA kAzi

MadawayakulevyanaUtumiajimbayawamadawawawezakuwanamadharamabayakatikautendajiwamfanyakazi,nailikupunguzamadawa ya kulevyamuhimu namasuala ya utumiaji mbaya wamadawakatikaKampuni,uhamasishajiulifanyikakupitiawarshanakutangazwakupitiamabango.Utafitiwakimsingikuhusumadawaya kulevya ulifanywa mwaka uliotangulia na ripoti ikawasilishwa na mshauri. mapendekezo yanaendelea kutekelezwa.

kulAinisHA mAsuAlA yA JinsiA nA ulemAvu kATikA

mAHAli PA kAzi

Ilikushughulikiamasualayakijinsiakatikamaeneoyakazi,ulainishajiwamasualayajinsiaulifanyikakwanjiayaukusanyajiwataarifazakumalizaubaguziwajinsia,nauhamasishajiwawafanyakazikupitiawarsha. Usawa wa kijinsia ulidumishwa wakati wa kuajiri kwakutekelezaserayaSerikalikuhusujinsiakatikaUtumishiwaUmma.


Wanachama wa Bodi wakishauriana na Mkurugenzi Mkuu wa Mumias Sugar Company, Bw Evans Kidero wakati wa ziara ya mradi

wa Mumias-Rangala.

39


Aidha, ulainishaji wa masuala ya ulemavu ulifanyika kwa njia yawarsha za uhamasishaji kwa wafanyakazi ili kufanya mahali pakufanyiakazikuwayakirafikikwawatuwenyeulemavu.

HAtuA ZA uAdiliFu

Ilikuendeleza jitihadazauongozibora,Kampuni ilichukuahatuaambazo zinaweza kuongeza uadilifu katika mahali pa kazi. Kamati ya uadilifu iliundwa na wanachama kuhamasisha kuhusu kupima uadilifu,naAfisawaMpangoakateuliwa.Aidha,wafanyakaziwawiliwalipewamafunzokamaMaafisawaKuhakikishaUadilifu(IAOs).

Wajumbewenginewawafanyakaziwalihamasishwakatikaseminaya uadilifu iliyoandaliwa na tume ya maadili & Kupambana na Ufisadi(EACC).NakalazaSheriayamwaka2003yaKupambanana Ufisadi na Uhalifu wa Kiuchumi, Sheria ya mwaka 2003 yamaadili ya Watumishi wa umma, na Kanuni na maadili ya tume ya utumishi wa umma zilisambazwa kwa wafanyakazi.

Kampuni ilirasimu sera za Zawadi & marupurupu na pia mgongano wa maslahi, na hatimaye sera Kupambana na Kukabiliana na udanganyifu. Ripoti ya robo mwaka zilipelekwa kwa tume ya Kupambana na Ufisadi (KACC). Utafiti wa kimsingi kuhusumtazamo juuyaufisadiulifanywanaripotikuwasilishwaambayoilidhihirisha fahirisi ya kimsingi ya 16.5%, ambayo inaonyesha mtazamowachiniwaufisadikatikakampuniyaKETRACO.

mkATABA wA uToAJi HuDumA

Katika mwaka huo, Mkataba wa Utoaji Huduma ulikaguliwaupya, ilikuurahisishazaidikwamtumiaji.UsambazajiwaMkatabawa huduma ulifanyika kwa kusambaza nakala kwa wadau na maonyeshoyanakalayaliyowekwamahalipazuri,katikamajengoya KetRAco.

Kampuniilijitoleaketekelezashughulizakekwakuzingatiamashartiyamkatabawakewa huduma. Utafiti wa kimsingi wa kuridhikakwawatejaulifanyikamwanzonimwamwaka,ambaoulionyeshafahirisiyakuridhikakwawatejaya64.74%,ilhaliutafitiuliofanyikamwishoni mwa kipindi hicho ulionyesha fahirisi ya kuridhika kwa watejaya71.90%.

uBuniFu wA uToAJi HuDumA

Katikakutambuakuwaubunifunikiendeshajichaukuaji,KampuniilianzishaubunifuwautoajihudumakwakushirikishamatumiziyateknolojiayaLiDDAR,ambayoinarahisishamchakatowautafitiwa

njiayakupitishialainizaumeme,napiakufanyaupatikanajiwaHakiza Kupita kuwa bora zaidi.

uTATuzi wA mAlAlAmiko yA ummA

Katikamwaka, kampuni ilifanya jitihada kadhaa kuhusu azimio lamalalamiko ya umma kukinuwiwa, kuhifadhi au kuendeleza kiwango chamwaka uliotangulia. Utaratibu wa utunzaji wa malalamikouliandaliwa, na kuwasilishwa kwa wafanyakazi. meza ya malalamiko ilianzishwa,naAfisawakupokeaMalalamikoyaUmmakuteuliwa.

Lainispeshelizasimunaanwaniyabaruapepezilitengwakwaajiliya kupokea malalamiko ya umma. Ripoti nne (4) za robo mwaka zilipelekwa kwa Kamati ya Kudumu ya malalamiko ya umma, na cheti kilitolewa kwa Kampuni.

Jukumu lA kAmPuni kwA JAmii (C.s.r.)

KETRACO ina sera ya Jukumu la Kampuni kwa jamii ambayohuongoza shughuli zake. Kwa mujibu wa sera hii, Kampuniinaendelea na kushiriki katika shughuli mbalimbali zinazohakikisha kwambashughulizakezinawajibikakijamii,kimazingiranakimaadili.Hasa, sisi pia hushiriki katika kusaidia juhudi za sekta ya nishatiinayolengakuhakikishauongezajiuwezo,mbinuboranaendelevu.

KetRAco pia kuhakikisha kwamba shughuli zake zinafanywa kwa kuzingatia hali za kibinadamu na mbinu bora, huku ikizingatiwa kwambaujenziwalainizaumemenausambazajizinawezakuhusishaununuzi dhahiri wa vipande vya ardhi na / au haki za Kupita, ambao unawezakuvuruganjiayamaishayawatuwalioathirikanamradi.

KetRAco kuhakikisha kwamba miradi yote inatekelezwa kupitia mchakato wa mashauriano na wadau. Katika kutekeleza shughuli zake, KetRAco na huzingatia masharti ya mkataba wake wa huduma.

Katikakutimizauwajibikajiwakekwajamii,Kampuni:• Inajitahidi kutekelezamiradi kwa kuzingatiamahitaji yote ya

kisheria, kiusalama, kiafya na kimazingira;

• Inataka kushirikiana na wadau katika miradi sahihi yamaendeleoyajamiikufuatiataratibuzilizowekwa;


40


• Itahakikisha kuwa makandarasi wetu wanatumia taratibuendelevu,zananavifaavinavyoepukauharibifuwahewa,majinaudongonakudumishaafyayamazingiranayajamiiambazotunatekeleza kazi zetu, na

• Kuhamasishakuhusukaziinayotokananaupendonayahiari.

mAeneo yA kuzingATiA

• Kutokananaasili ya shughulinamiradi iliyotekelezwakatikamaeneo ya mbali, KETRACO itajitahidi kupitisha mfumojumuishi ili kuhakikisha kuwawakatiwamuundowamradi,masuala ya jamii namazingira yanakumbatiwa, na hasa yaleya:Elimu;Afya;Maji;Kuwekataavijijini,Mazingira,Utamaduni,Michezo&Burudani;naUjengawaUwezo.

Katika mwaka, KETRACO ilijihusisha katika shughuli maalumzifuatazo:

• UjenziwamadarasakwajamiiyaGedekwakushirikiananamkandarasi wa mradi wa Rabai-malindi- Garsen-lamu,

• Kufadhilinakushirikikatikamkutanowakongamanolapili la kitaifa la nishati

• IliungamkonombiozaTurkwellzaamaniambazozimepangwa, tukio ambalo linanuia kuleta amani na ushirikiano kwajamiikatikaKaskazinimwaBondelaUfa.

• Ilichangianguonavifaavyamalazikwawaathiriwawamkasa wa moto wa sinai kupitia mipango ya wafanyakazi.

KETRACO inaelewa kuwa vitendo na tabia ya kila mmoja wawafanyakazi wake, makandarasi na mawakala wake ndio msingi ambaowadauwetuhutathminikujitoleakwetu,nakatikakuafikiaviwangovyahaliyajuuvyamajukumuyakampunikwajamiiwakatitunatekelezamajukumuyetuyamsingi.

mwelekeo

Kampuni itaendelea kutekeleza majukumu yake ya msingi yamaendeleonauendeshajiwamiundombinuyamtandaowagridiyataifakatikautekelezajiwaDirayaTaifayamwaka2030.

Itaendelea kudumisha mazingira ambayo yanadhamini watejawake, wenyehisa, washirika wa maendeleo, wateja, wafanyakazi,wafanyabiashara, jamii, umma na wadau wengine. Pamojana kuendelea kuungwa mkono na serikali, halmashauri ya Wakurugenzi,wafanyakazi,wateja,wauzajinawadauwengine,nakukuza utamaduni wetuwa kazi ya pamoja, utaaluamu, ubunifu,uvumbuzinakujitoa,sisitunaahidikujitahidiilikutimizaMaonoYetu.

MhAnDisi JOEL KiiLumkurugenzi mkuu nA AFisA mTenDAJi mkuu

8th January, 2012

Wafanyikazi wakishiriki katika shughuli za ujenzi wa timu ambazo zinanuia kuimarisha kitengo kilicho na umoja katika kujenga laini za

usambazaji umeme za kiwango cha kimataifa.


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corporate Governance statement

corporate governance is the process and structure used to direct and manage the business affairs of the company towards enhancing prosperity and corporate accountability with the ultimate objective of realising shareholders’ long term valuewhile taking into account the interest of other stakeholders. the directors are responsible for the corporate governance practices of the company. this statement sets out the main practices in operation during the year under review.

BoARd oF diRectoRs

the Board of directors has nine members comprising the managing director and eight non-executive directors, including the chairman. Although incorporated under the companies Act, cap 486, the company is governed under the provisions of state corporations Act, cap 446 by virtue of the company being wholly owned by the Government. the non-executive directors are independent within the meaning of the capital markets Authority’s Guidelines on corporate Governance. information on directors’profilesisshownonpages6,7,8and9.

TheChairmanandManagingDirector&ChiefExecutiveOfficerplay separate roles in the governance structure of the company. the chairman is primarily responsible for the running of the Board andensuringthatitissuppliedinatimelymannerwithsufficientinformation to enable it to discharge its duties. the managing director & ceo is responsible for recommending business plans and the budget to the Board, implementing approved corporate strategies and day to day administration of the company.

TheprimaryresponsibilitiesoftheBoardinclude:definingthevisionand mission statements of the company elucidated in a corporate strategicplanwhichdefinesandsetsthestrategicobjectivesandgoals for the company; establishment of short and long term goalsandensuringpreparationofinterimandtheannualfinancialstatements; review and approval of the annual budgets for the financialperformanceof theCompany;monitoringperformanceperiodically; managing risks by ensuring that the company has implemented adequate systems of internal controls together with appropriate monitoring of compliance activities; and working with management to realise mandate of the company.

there are deliberate measures and plans in place for all directors to receive appropriate training and to take independent professional advice if necessary. new directors are also well inducted by

provision of necessary information pertinent to the company’s business, meetings with management and training. in this regard, directors were trained on good corporate governance by the CentreforCorporateGovernanceduringthefirstsixmonthsofincorporation of the company to ensure that they started on a sure footing by enhancing their skills. the Board attended a workshop on procurement conducted by the public procurement oversight Authority.

there is diverse mix of skills in the board, as is shown from the profileofdirectorselsewhereinthisReportwhichoutlinestheirprofessionalqualificationsandexperience.it behoved the Board sitting regularly during the set-up phase of the company to put in place structures and recruit appropriate staff to commence business. the Board met in accordance with requirements of the business. the Board held a total of 9 meetings during the year, which were very well attended.

Attendance of Board meetings

name Attendance

1 mr. Justus kageenu 9

2 eng. Julius mwathani

(Alternate Director to mr. Patrick

nyoike, Ps, moe) 8

3 eng. Joel kiilu 9

4 mr. Domiciano maingi 8

5 mr. Daniel k. mwaura 9

6 Hon. Jimmy Ang’wenyi 9

7 Hon. Jafaar sheikh 9

8 rev (Dr) Jessie mutura 9

9 mrs. Felister kivisi (Alternate Director

to mr. Joseph kinyua, Ps, Treasury) 9

BoARd committees

the following Board committees were in place during the period under review year :-

Audit & Risk committee

the Audit & Risk committee was constituted in February, 2010 and its mandate redefined inApril 2010 in line withTreasurycircular no. 16/2005 on establishment and operationalization of

42


2011

corporate Governance statementkeTrACo TrAinee

audit committees in the public service. the committee comprises five non-executive directors and is chaired by a non-executivedirector.

the members of the committee during the period under

review were:

1. Hon. Jafaar mohammed (Chairman)

2. mr. Domiciano maingi

3. rev (Dr) Jessie mutura

4. mrs. Felister kivisi

5. mr. Daniel mwaura

the Audit & Risk committee held 5 meetings during the period

and were well attended.

name Attendance

1 Hon. Jafaar mohammed- Chair 5


3 mr. Daniel k. mwaura 4

4 rev (Dr) Jessie mutura 5

5 mrs. Felister kivisi 3

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members of the Committee include:

1. Ho. Jimmy Ang’wenyi- Chairman

2. Hon. Jafaar mohammed

3. mr. Daniel k. mwaura

the Adhoc committee, having visited the shores of lake turkana on the lodwar side the previous year also visited loiyangalani on the eastern shores of the lake to engage with the local communitieswithaview togetfirst-hand informationon theirconcerns. the committee routinely invites management staff with relevant expertise to its meetings.

the committee held a total of 4 meetings during the year.

Ad hoc committee

name Attendance

1 hon. Jimmy Ang’wenyi 3

2 mr. daniel K. mwaura 4

3 hon. Jafaar sheikh 4

performance contracting committee

the performance contracting committee was constituted on 27th July, 2009 to spearhead the negotiations with the Government on performance contracting. the company signed performance contracts with the Government for the period and 2010/2011 and 2011/2012

members constituting the Committee are:-

1. mr. Justus kageenu - Chairman

2. rev (Dr) Jessie mutura

3. eng. Joel kiilu

the committee held a total of 4 meetings during the period under review.

Attendance: Performance Contracting Committee

name Attendance

1 mr. Justus kageenu 4

2 eng. Joel kiilu 4

3 rev (Dr). Jessie mutura 4

the committee routinely invites the managing director, and at times the other key staff to attend the meetings. the head of internal Audit is the secretary to the committee.

staff and Remuneration committee

the Board has constituted a staff & Remuneration committee whose mandate includes determining the terms and conditions of service of staff and approval of recommendations for appointment and disciplinary issues of senior staff.

The members who served in the Committee were as follows:

1. rev (Dr) Jessie mutura ( Chairperson)

2. eng. Julius mwathani (Alternate Director to mr. Patrick

nyoike, Ps, moe)

3. Hon. Jimmy Ang’wenyi

4. Domiciano maingi

5. eng. Joel kiilu

When appropriate, the committee invites other members of the Board and staff to its meetings.

the committee held 4 meetings during the period under review.

staff & Remuneration committee

name Attendance

1 rev (Dr) Jessie mutura- Chair 4

2 Hon. Jimmy Ang’wenyi 4


4 eng. Julius mwathani 2

5 eng. Joel kiilu 4

Adhoc Board Committee on ethiopia-kenya inter-connector

the Board on 30th June, 2009 constituted an Adhoc committee on the ethiopia- Kenya interconnector arising from concerns raised on the impact of GiBe iii dam on lake turkana. the mandate of the Adhoc committee of the Board was to engage the stakeholders, monitor and address issues impacting on the project andmakerecommendations to the Board with a view to ensure that the projectsucceeds.


44


diRectoRs’ RemuneRAtion

details of directors’ remuneration are set out in the report on page 64.

there were no directors’ loans at any time during the year.

inteRnAl contRols

the company has systems and processes to ensure requisite internal controls, physical security of assets and reporting of accurate and up to-date information. Whereas the Board has overall responsibility for the systems of internal control which are fully embedded in the operations of the company, certain responsibilities, such as review of the effectiveness of the internal control systems are delegated to the Audit and Risk committee of the Board. internal controls comprise of methods and procedures adopted by management to provide reasonable assurance in safeguarding assets, prevention and detection of errors, accuracy and completeness of accounting records together with reliability offinancialstatements.

An integrated enterprise Resource planning system is also under consideration to replace the interim it software accounting system which is in place.

AccountABility And Audit

Directors’ responsibilities in relation to financial statements

The Company law requires the Directors to prepare financialstatementsforeachfinancialyearwhichgiveatrueandfairviewofthestateofaffairsofthecompanyasattheendofthefinancialyearandoftheprofitorlossofthecompanyforthatperiod.Thedirectors are responsible for ensuring that suitable accounting policies are consistently applied supported by reasonable and prudentjudgementsandestimatesandthoseapplicableaccountingstandards are followed.

the directors have responsibility for ensuring that the company keeps proper accounting records, which disclose with reasonable accuracyat any time thefinancialpositionof thecompanyandenablethemtoensurethatthefinancialstatementscomplywiththe companies Act and the state corporations Act. they also have general responsibility for the systems of internal control for safeguarding the assets of the company and to prevent and detect fraud and other irregularities.

CommuniCATion wiTH sTAkeHolDers

the company places a great deal of importance on open communication with its stakeholders. this is achieved through press releases, updates posted on the company website www.ketraco.co.ke, and circulation of audited financial statementson an annual basis. shareholders also have an opportunity to dialogue with the Board of directors and management during the annual general meetings. open forums are also organised with development partners and other stakeholders to discuss progress ofon-goingandplannedprojects.

mAJor sTAkeHolDers

in the course of doing business, the company takes cognizance and fully engages with the following major stakeholders:Government through the ministry of energy and treasury; Funding and development partners including the World Bank; African development Bank (AfdB); AFd; european investment Bank (eiB); JicA; exim Bank of china; Kreditanstalt für Wiederaufbau (KfW) and recently EXIM Bank of India. Others include theKenya power; Kenya energy Generating company limited (KenGen); Geothermal development company (Gdc); Rural Electrification Authority, (REA) Energy Regulatory Commission(eRc); independent power producers and other electricity sub-sector players.

JusTus G. KAGEEnucHAiRmAn

8th January, 2012


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TheDirectorssubmittheirreporttogetherwiththeauditedfinancialstatementsfortheyearended30thJune2011whichshowthestate of affairs of the company.

Principal Activities

the core business of the company is to plan, design, construct, operate and maintain new high voltage (132 kv and above) electricity transmission infrastructure that will form the backbone of the national transmission Grid, build interconnectors to facilitate regional power trade, and to wheel electricity to the Kenya power and other end users from generators who produce power in bulk.

Results

the operating results of the company for the year under review are shown on pages 48 to 64.

Dividends

the Board of directors do not recommend payment of a dividend for the period under review. Capital expenditure

As at 30th June, 2011, the net book value of the transmission infrastructure amounted to Kshs.6,656, million. Grants from our development partners amounted to Kshs.8,293 million while exchequer funding for development expenditure was Kshs.7,694 million. net capital work-in-progress amounted to Kshs.5,666 million.

directors

the members who served in the Board of directors during the year are shown on page 4 to 9.

Auditors

the Auditor General is responsible for carrying out the statutory audit of the company’s books of account in accordance with the state corporations Act, cap 446, section 14 (3) and section 39 of the public Audit Act, 2003. section 39 (1) of the public Audit Act empowers the Auditor General to appoint other auditors to carry out audit on his behalf. Accordingly, deloitte and touche were appointed to carry out the audit for the year ended 30th June, 2011.

By order of the Board

DunCAn K. MAChAriAcompAny secRetARy

8th January, 2012

Report of the directors

46


statement of directors’ Responsibilities

TheCompaniesActCap486requiresthedirectorstopreparefinancialstatementsforeachfinancialyearwhichgiveatrueandfairviewofthestateofaffairsoftheCompanyasattheendofthefinancialyearandoftheoperatingresultsoftheCompanyforthatyear.ItalsorequiresthedirectorsensuretheCompanykeepsproperaccountingrecordswhichdisclosewithreasonableaccuracythefinancialposition of the company. they are also responsible for safeguarding the assets of the company.

ThedirectorsareresponsibleforthepreparationandfairpresentationofthesefinancialstatementsinaccordancewithInternationalFinancial Reporting standards and the requirements of the Kenyan companies Act, and for such internal controls as directors determine arenecessarytoenablethepreparationoffinancialstatementsthatarefreefrommaterialmisstatement,whetherduetofraudorerror.

Thedirectorsacceptresponsibilityfortheannualfinancialstatements,whichhavebeenpreparedusingappropriateaccountingpoliciessupportedbyreasonableandprudentjudgementsandestimates,inconformitywithInternationalFinancialReportingStandardsandinthemannerrequiredbytheKenyanCompaniesAct,Cap486.ThedirectorsareoftheopinionthatthefinancialstatementsgiveatrueandfairviewofthestateofthefinancialaffairsoftheCompanyandofitsoperatingresults.Thedirectorsfurtheracceptresponsibilityforthemaintenanceofaccountingrecordswhichmayberelieduponinthepreparationoffinancialstatements,aswellasadequatesystemsofinternalfinancialcontrol.

nothing has come to the attention of the directors to indicate that the company will not remain a going concern for at least the next twelve months from the date of this statement.

signed for and on behalf of the Board by:-

JusTus G. KAGEEnu EnG. JOEL M. KiiLu cHAiRmAn mAnAGinG diRectoR & ceo

47


RepoRt on tHe FinAnciAl stAtementsTheaccompanyingfinancial statementsofKenyaElectricityTransmissioncompany limited set out on pages 48 to 64, which comprise the statementoffinancialpositionasat30June2011,andthestatementofcomprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and a summary of significantaccounting policies and otherexplanatory information , have been audited on my behalf by deloitle and touche auditors appointed under section 39 of the public Audit Act 2003. the auditors have duly reported to me the resultsoftheirauditandonthebasisoftheirreport,Iamsatisfiedthatallthe information and explanations which, to the best of myknowledge and belief, were necessary for the purpose of the audit were obtained.

management’s Responsibility for the Financial statementsmanagement is responsible for the preparation and fair presentation of the financialstatements inaccordancewith InternationalFinancialReportingstandards and for such internal control as the management determines is necessarytoenablethepreparationoffinancialstatementsthatarefreefrom material misstatement, whether due to fraud or error .

Themanagement is also responsible for the submission of its financialstatements to the Auditor-General in accordance with the provisions of section 13 of the public Audit Act, 2003.

Responsibility of the Auditor -GeneralMyresponsibilityistoexpressanindependentopiniononthesefinancialstatements based on the audit and report in accordance with the provisions of section 15 of the public Audit Act, 2003. the audit was conducted in accordance with international standards on Auditing . those standards require compliance with ethical requirements and that the audit be planned and performed to obtain reasonable assurance about whether thefinancialstatementsarefreefrommaterialmisstatement.

An audit involves performin q, procedures to obtain audit evidence about theamountsanddisclosures inthefinancialstatements.Theproceduresselecteddependontheauditor’sjudgement,includingtheassessmentoftherisksof,materialmisstatementofthefinancialstatements,whetherdueto fraud or error.

in making those risk assessments, the auditor considers internal control relevanttotheentity’spreparationandfairpresentationofthefinancialstatements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectivenes s of the company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the management, as well

Report of the independent Auditors’

asevaluatingtheoverallpresentationofthefinancialstatements.Ibelievethattheauditevidenceobtainedissufficientandappropriatetoprovide a basis for my opinion .

Webelieve that the audit evidencewe have obtained is sufficient andappropriate to provide a basis for our audit opinion.

unqualified opinion In my opinion , the financial statements present fairly , in all materialrespects, thefinancialpositionof theCompanyasat30 June2011andofitsfinancialperformanceanditscashflowsfortheyearthenendedinaccordance with international Financial Reporting standards and comply with the companies Act, cap 486 of the laws of Kenya.

emphasis of matterWithout qualifying my opinion, i draw attention to note 3 which describes uncertainty relating to recognized income on wheeling charges, billed to Kenya power and lighting company limited (Kplc) amounting to Kshs.280,280,000 (2010-Kshs.262,154,000). the charges were based on the energy Regulatory commission approved transmi ssion tariff which Kplc disputes.

revenue - wheeling chargeWedrawattentiontonote3inthefinancialstatementswhichdescribesthe uncertainty related to amounts billed and receivable from the Kenya Powerforwheelingcharges.Ouropinionisnotqualifiedinrespectofthismatter.

RepoRt on otHeR leGAl And ReGulAtoRy ReQuiRements As required by the Kenya companies Act, i report based on the audit, that; i) i have obtained all the information and explanations , which, to the

best of my knowledge and belief , were necessary for the purpose of audit;

ii) in my opinion proper books of account have been kept by the company so far as appears from the examination of those books; and,

iii) TheCompany’sstatementoffinancialpositionandstatementof comprehensive income are in agreement with the books of account.

EDWArD r. OuKOAuditoR-GeneRAl

nairobi, march 6, 2012

telephone: +254 20 342330Fax: +254 20 311482email: [email protected]: www.kenao.go.ke

p.o. Box 30084 - 00100nairobi

REPUBLIC OF KENYA

KENYA NATIONAL AUDIT OFFICErePorT oF THe AuDiTor-generAl on THe kenyA eleCTriCiTy TrAnsmission ComPAny limiTeD

For THe yeAr enDeD 30 June 2011

48


statement of comprehensive incomeFoR the yeAR ended 30 June 2011

2011 2010

notes sh’000 sh’000

income 4 940,315 647,190

EXPENSES 460,592 222,808

PROFITBEFORETAXATION 5 479,723 424,382

TAXATIONCHARGE 7 (57,815) (35,711)

pRoFit FoR the yeAR 421,908 388,671

otheR compRehensive income - -

totAl compRehensive income FoR the yeAR 421,908 388,671

49


statement of Fnancial positionFoR the yeAR ended 30 June 2011

2011 2010 notes sh’000 sh’000

Assets non current assetsproperty, plant and equipment 8 12,304,191 5,192,448intangible assets 9 18,154 -deferred tax asset 10 4,082 - 12,326,427 5,192,448current assetsReceivables and prepayments 11 617,783 268,945

cash and bank balances 6,042,043 3,299,408

6,659,826 3,568,353

total assets 18,986,253 8,760,801

eQuity And liABilitiescapital and reserves share capital 12 2,000 2,000exchequer funding 13 7,694,407 3,772,980Reserves 790,579 388,671 8,486,986 4,163,651non-current liabilitiesdeferred grant income 14 8,292,836 4,050,354 current liabilitiesdeferred grant income 14 111,667 49,147payable and accruals 15 2,065,990 479,489dividend payable 20,000 -corporate tax payable 7 8,774 18,160 2,206,431 546,796 total equity and liabilities 18,986,253 8,760,801

Thefinancialstatementsonpages42to58wereapprovedbytheboardofdirectorson8thJanuary,2012andweresignedonitsbehalf by:

JusTus G. KAGEEnu EnG. JOEL M. KiiLuchAiRmAn md & ceo

50


statement of changes in equity FoR the yeAR ended 30 June 2011

share exchequer revenue total capital funding reserve equity kshs’000 kshs’000 kshs’000 kshs’000As at beginning of periodissue of shares 2,000 - - 2,000

exchequer funding for developmentexpenditure - 3,772,980 - 3,772,980

surplus for the year - - 388,671 388,671

At 30 June 2010 2,000 3,772,980 388,671 4,163,651

At 1 July 2010 2,000 3,772,980 388,671 4,163,651

exchequer funding for development - 3,921,427 - 3,921,427expenditure

surplus for the year - - 421,908 421,908

dividend – 2010 - - (20,000) (20,000)

At 30 June 2011 2,000 7,694,407 790,579 8,486,986

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statement of cash FlowsFoR the yeAR ended 30 June 2011

2011 2010 notes sh’000 sh’000

cAsh FloWs FRom opeRAtinG Activitiescash generated from operations 16(a) 1,753,716 685,156taxation paid 7 (71,238) (17,551)

net cash generated from/(used in) operating activities 1,682,433 667,605

cAsh FloWs FRom investinG Activities

purchase of property, plant and equipment 8 (49,117) (1,853,029)Workinprogress(projectcosts) 8 (7,146,637) (3,389,649)purchase of intangible assets 9 (19,620) -

net cash used in investing activities (7,215,374) (5,242,678) cAsh FloWs FRom FinAncinG Activities

share capital 12 - 2,000exchequer funding (capital) 13 3,921,427 3,772,980Grant income 16(b) 4,354,149 4,099,501

Netcashgeneratedfromfinancingactivities 8,275,576 7,872,481

incReAse in cAsh And cAsh eQuivAlents 2,742,635 3,299,408

cAsh And cAsh eQuivAlents At BeGinninG oF yeAR 3,299,408 -

cAsh And cAsh eQuivAlents At end oF yeAR 16(c) 6,042,043 3,299,408

52


notes to the Financial statementsFoR the yeAR ended 30 June 2011

1. ACCounTing PoliCies

statement of compliance with international Financial

reporting Framework (iFrs)

Thefinancialstatementshavebeenpreparedinaccordance with international Financial Reporting standards (iFRs).

For the Kenyan companies Act reporting purposes, in these financialstatementsthebalancesheetisrepresentedby/ isequivalenttothestatementoffinancialpositionandthe profitandlossaccountispresentedinthestatementof comprehensive income.

Adoption of new and revised international Financial

reporting standards (iFrss) and interpretations (iFriC)

a) new standards and amendments to published standards

effective for the year ended 30 June 2011

the following new standards issued by the international Accounting standards Board are effective in the current period.Thesehavebeenadoptedinthefinancialstatementsof the company in the year.

Amendments to iAs 7 statement of Cash Flows (as part of

improvements to iFrss issued in 2009)

the amendments to iAs 7 specify that only expenditures thatresultinarecognisedassetinthestatementoffinancialpositioncanbeclassifiedasinvestingactivitiesinthestatementofcashflows.Thestatementofcashflowsonpage10complieswith this amendment.

other new standards and interpretations effective in the periodunderreviewhavenoeffectonthecompany’sfinancialstatements.

(b) new standards and amendments to published standards

and interpretations in issue but not yet effective in the year

ended 30 June 2011 At the date of authorization of these financial statements,

there were a number of revised or amended standards and interpretations that were in issue but not yet effective. the directors are currently assessing the impact and expected timing of adoption of these amendments on the company’s resultsandfinancialposition.Thedirectorsanticipatethatthe

new or revised standards and interpretations will have no materialimpactonthefinancialstatementsofthecompanyinfuture periods.

(c) early adoption of standards

the company did not early-adopt any new or amended standards in 2011.

Basis of preparation

The financial statements are prepared under the historicalcost convention as modified to include the revaluation ofcertain assets. the principal accounting policies adopted in the preparationof thesefinancialstatementsremainunchangedfrom the previous year and are set out below.

revenue recognition

the main source of revenue is wheeling charge for transmitting electricity from the producer (source) to a substation to facilitate distribution to the final consumer. The wheelingcharge is measured based on kilowatt hours (KWh) of power transmitted and the revenue is recognised on accrual basis.

Revenue from rendering the service is recognised when all thefollowingconditionsaresatisfied:

• theamountofrevenuecanbemeasuredreliably;• itisprobablethattheeconomicbenefitsassociatedwiththe

transactionwillflowtotheentity;• thestageofcompletionofthetransactionattheendofthe

reporting period can be measured reliably; and• the costs incurred for the transaction and the costs to

complete the transaction can be measured reliably.

interest income is recognised on a time proportion basis using the effective interest method.

exchequer funding

this represents amounts received from treasury for both recurrent and development expenditure. Amounts received from the exchequer are recognised on cash accounting basis, that is, as and when received.

53



1. ACCounTing PoliCies (Continued)

Government grants are recognised where there is reasonable assurance that the grant will be received and all attaching conditions will be complied with.

(a) revenue grant

Grants received to compensate expenses or for the purpose of giving immediate support to the company with no future related costs are recognised inprofitor loss in the yearofreceiptand/orcommencementoftheprojectforwhichtheywere intended.

(b) Capital grant

Government grants related to assets are presented in the statement of financial position by setting up the grantas deferred income. Government grants whose primary condition is that the company should purchase, construct or otherwise acquire non-current assets are recognised as deferred revenue in the statementof financial position andtransferred to profit and loss on a systematic and rationalbasis over the useful lives of the related assets.

Taxation

current taxation is provided on the basis of the results for the year as shown in the financial statements, adjusted inaccordance with the tax legislation.

deferred tax is provided using the liability method for all temporary differences arising between the tax base of the assets and liabilities and their carrying values for financialreporting purposes. currently enacted tax rates are used to determine deferred income tax. the principal temporary differences arise from depreciation on property, plant and equipment.

deferred tax assets are recognised for tax losses carried forward only to the extent that realisation of the related tax benefitcanbeforeseen.

property, plant and equipment

property, plant and equipment are stated as cost less accumulated depreciation and any accumulated impairness losses. historical cost includes expenditure that is directly attributable to the acquisition of the items. depreciation

is calculated on straight line method to write-off the cost or to revalued amount of property, plant and equipment in equal annual instalments over their estimated useful lives. depreciation is calculated from the date of purchase of an asset.

the annual rates used are:

capital work in progress nil

Transmission line 2.5%

motor vehicles 25%

Furniture, fittings and office equipment 12.5%

Computers & accessories 33.3%

the annual depreciation on the revaluation surplus element of property, plant and equipment is transferred from the revaluation surplus to retained earnings.

Gains and issues on disposal of property, plant and equipment are determined by reference to their carrying amount and are included in the statement of comprehensive income. on disposal of revalued assets, amounts in the revaluation surplus relating to the asset are transferred to retained earnings.

the carrying values of property, plant and equipment are reviewed annually and adjusted for impairment where it isconsidered necessary.

intangible assets

costs incurred on computer software are initially accounted for at cost as intangible assets and subsequently at cost less any accumulated amortisation and accumulated impairment losses. Amortisation is calculated on the straight line basis over the estimated useful lives not exceeding a period of 3 years.

Accounts receivables

Accounts receivables are carried at anticipated realisable value.

trade payables

liabilities for trade and other amounts payable are carried at costs which is the fair value of the consideration to be paid in future for goods and services received, whether billed or not.

54


1. ACCounTing PoliCies (Continued)

employee benefits costs

(i) retirement benefit obligations

The company operates a defined contribution retirement,benefit scheme for its permanent employees. A definedcontribution plan is a pension plan under which the company paysfixedcontributions intoaseparateentity. Theschemeis funded by contributions from both the company and employees. the company and all its employees also contribute to the National Social Security Fund, which is a definedcontribution scheme.

in addition the company pays gratuity to top management on contract. the gratuity is paid at the end of the contract period at the rate of 15% and 31% of the total basic salary over the contract period. An accrual is made for gratuity based on the rate of 15% and 31% pa.

(ii) other entitlements

the estimated monetary liability for employees accrued leave entitlement at the balance sheet date is recognised as an expense accrual.

Foreign currencies

The financial statements are presented in Kenya Shillings,which is the company’s functional and reporting currency. in preparing thefinancial statements, transactions incurrenciesother than the entity’s functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

exchange differences on monetary items are recognised in profitorlossintheperiodinwhichtheyarise.

Comparatives

Wherenecessary,comparativefigureshavebeenreclassifiedto conform to changes in presentation in the current year. the comparative amounts cover a period of 18 months as the year of inception.


2. CriTiCAl JuDgemenTs in APPlying THe

entity’s AccountinG policies

in the process of applying the entity’s accounting policies, management has made estimates and assumptions that affect the reported amounts of assets and liabilities within the next financial year. Estimates and judgments are continuallyevaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances

impairment losses

At each reporting date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. if any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash generating unit to which the asset belongs.

property and equipment

critical estimates are made by the directors in determining depreciation rates for equipment. the rates used are set out in note 1 above.

3. wHeeling CHArges reCeivABle From kPlC

the company has recognised income on wheeling charges and billed the Kenya power (Kplc) sh 280,280,000 (2010 sh - 262,154,000) based on energy Regulatory commission (eRc) approved transmission tariff of Kshs 0.77 per Kwh multiplied by the units generated and wheeled through the transmission lines owned by KetRAco. however, Kplc proposes to use the embedded cost model that incorporates the length of the transmission line in the computation of wheeling charge payable to KetRAco and has only committed to pay sh 167,900,400 out of the outstanding amount of sh 542,434,000 included in receivables. the agreed units of electricity transmitted during the period were 364,000,000 Kwh ( 2010- 340,460,000 Kwh). management has initiated discussions with Kplc and the Government for the balance of sh 374,533,600 as at 30 June 2011 to be paid by Kplc.

4. inCome

2011 2010 sh’000 sh’000

Recurrent exchequer Funding 400,000 266,000

Wheeling charge 280,280 262,154

interest income 209,505 117,205

deferred grant income amortisation 49,147 -

other income 1,383 1,831

940,315 647,190

Interest income relates to interest earnedon the bank account balances and it is subject to 15%withholding tax.Other incomerepresents income received from sale of tender documents.

5 pRoFit BeFoRe tAXAtion

Theprofitbeforetaxationisarrivedataftercharging/(crediting) 2011 2010 sh’000 sh’000

staff costs (note 6) 233,895 70,297

directors’ emoluments - fees 2,016 1,344

- other 25,396 14,710

depreciation 84,011 50,230

Amortisation 1,466 -

Auditors’ remuneration – current year 1,500 500

6 stAFF eXpenses

salaries and Wages 165,938 41,638

other staff costs 52,755 23,022

leave pay provision 6,626 -

pension contribution 5,401 1,637

Gratuity provisions 2,976 3,841

nssF and nhiF contributions 199 159

233,895 70,297

number of staff 107 51


56



7. TAXATion

2011 2010

sh’000 sh’000

(a) taxation charge Currenttaxationbasedonadjustedprofitat30%currentyearcharge 59,738 35,711 current tax penalty 3,873 - prior year overcharge - current tax (5,887) - prior year tax penalty 4,173 - 61,897 35,711

deferred taxation (note 10) - current year (2,923) - - prior year provision (1,159) -

(4,082) -

57,815 35,711(b) Reconciliation of taxation charge to expected taxationbasedonaccountingprofitbeforetaxation

Accountingprofitbeforetaxation 479,723 424,382 taxation at the applicable rate 30% 143,917 127,315 tax effect of non-deductible expenses 91,038 57,160 tax effect of revenue not taxable (178,140) (148,764) tax penalty - current year 3,873 - - prior year 4,173 - prior year overcharge – current tax (5,887) - prior year deferred tax provision (1,159) -

57,815 35,711c) taxation payable

Balance brought forward 18,160 - charge for the year 61,897 35,711 paid during the year (71,283) (17,551) 8,774 18,160

57


8. ProPerTy, PlAnT AnD eQuiPmenT

Furniture, sh’000 fittings Capital sh’000 lines vehicles & office Accessories work in sh’000 transmission motor Furniture computer progress total sh’000 sh’000 sh’000 sh’000 sh’000 sh’000

cost

At 1 July 2009

Additions 1,785,561 19,023 48,148 297 3,389,649 5,242,678

At 30 June 2010 1,785,561 19,023 48,148 297 3,389,649 5,242,678

At 1 July 2010 1,785,561 19,023 48,148 297 3,389,649 5,242,678

Additions - 18,700 21,196 9,221 7,146,636 7,195,754

transfers from Wip 4,870,067 - - - (4,870,067) -

At 30 June 2011 6,655,628 37,723 69,344 9,518 5,666,218 12,438,432

depReciAtion

At 1 July 2009 - - - - - -

charge for the year 44,639 3,328 2,234 29 - 50,230

At 31 June 2010 44,639 3,328 2,234 29 - 50,230

At 1 July 2010 44,639 3,328 2,234 29 - 50,230

charge for the year 64,987 8,890 7,512 2,622 - 84,011

At 30 June 2011 109,626 12,218 9,746 2,651 134,241

net BooK vAlue

At 30 June 2011 6,546,002 25,505 59,598 6,867 5,666,218 12,304,191

At 30 June 2010 1,740,922 15,695 45,914 268 3,389,649 5,192,448

At the date of incorporation various transmission lines were transferred from Kenya power to KetRAco. however as at the date of reporting the legal documentation in relation to the transfer of these assets amounting to sh sh 6,655,628,000 had not been completed.


58



9. inTAngiBle AsseTs - computer software 2011 2010

sh ‘000’ sh ‘000’

costAt beginning of the period - -Additions 19,620 -At 30 June 19,620 -

AmoRtisAtionAt 1 July - -charge for the year 1,466 -At 30 June 1,466 -

net BooK vAlueAt 30 June 18,154 -

10. DeFerreD TAX AsseT

the net deferred tax asset is attributable to the following items:

deferred tax asset:excess depreciation over capital allowances 49 7leave pay provision 1,988 -staff gratuity 2,045 1,152deferred tax asset not recognised - (1,159) 4,082 -movement in deferred tax accountAt beginning of the year - -Profitorlosscredit(note6) 2,923 -prior year under provision 1,159 -At end of the year 4,082 -

11. reCeivABles AnD PrePAymenTs

Wheeling charge from Kplc 542,434 262,154other receivables 65,079 -medical and insurance prepayments 6,891 4,241Rent deposit 3,379 2,550 617,783 268,945

59



12. sHAre CAPiTAl 2011 2010

sh ‘000’ sh ‘000’

Authorised, issued and fully paid 20,000 shares of sh 100 each 2,000 2,000

13. eXCHeQuer FunDing

At beginning of the period 3,772,980 - Received 3,921,427 3,772,980

At end of the period 7,694,407 3,772,980

this relates to receipts from the exchequer for development (capital) expenditure. the amount has been committed for construc-tion of various transmission lines.

14. DeFerreD grAnT inCome

these relate to grants from the Government of Kenya used for the construction of transmission lines that are being amortised over the useful lives of the respective assets.

Amounts will be amortised as below : Grant income to be amortised within one year 111,667 49,147Grant income to be amortised after one year 8,292,836 4,050,354At the end of the period 8,404,503 4,099,501

15. TrADe AnD oTHer PAyABles

trade payables 471,541 441,052Accruals 1,593,532 38,437payroll accrual 918 - 2,065,990 479,489

16. noTes To THe CAsH Flow sTATemenT

(a) Reconciliationofprofitbeforetaxtocashgeneratedfromoperations:

Profitbeforetax 479,723 424,382 Adjustmentsfor : depreciation 84,011 50,230 Amortisation 1,466 - deferred grant income amortised (49,147) -

Profitbeforeworkingcapitalchanges 516,053 474,612

changes in working capital: increase in trade and other receivables (348,838) (268,945) increase in trade and other payables 1,586,501 479,489 cash generated from operations 1,753,716 685,156

60



16. noTes To THe CAsH Flow sTATemenT (continued )

(b) Analysis of changes in deferred grant 2011 2010

sh ‘000’ sh ‘000’

income: At beginning of period 4,099,501 - Received 4,354,149 4,099,501 Amortised (note 4) (49,147) - At end of period (note 14) 8,404,503 4,099,501

c) Analysis of balance of cash and cash equivalents cash and bank balances 6,042,043 3,299,408

17. key mAnAgemenT ComPensATion

2011 2010

shs ‘000’ shs ‘000’

the remuneration of directors and other members of keymanagement during the year was as follows:Salariesandotherbenefits 47,308 28,147directors’ fees and emoluments (included in key management compensation above) 27,412 16,054

18. FuTure oPerATing leAse renTAl PAyABle

Amounts payable by the company under various operating lease agreements negotiated with landlords as at the year end were as follows: Within one year 10,920 10,302Inthesecondtofifthyearsinclusive 36,850 47,770 47,770 58,072

19. FinAnCiAl risk mAnAgemenT

Thecompany’sactivitiesexposeittoavarietyoffinancialrisksincludingcreditandliquidityrisksandeffectsofchangesinforeigncur-rency. the company’s overall risk management programme focuses on unpredictability of changes in the business environment and seeks to minimise the potential adverse effect of such risks on its performance by setting acceptable levels of risk. the company does not hedge any risks and has in place policies to ensure that credit is only extended to customers with an established credit history.

Thecompany’sfinancialriskmanagementobjectivesandpoliciesaredetailedbelow:

(i) Credit risk

Creditriskreferstotheriskthatacounterpartywilldefaultonitscontractualobligationsresultinginfinanciallosstothecompany.the company’s credit risk is primarily attributable to its receivables. management assesses the credit quality of each customer, tak-ingintoaccountitsfinancialposition,pastexperienceandotherfactors.Individualrisklimitsaresetbasedoninternalorexternalassessmentinaccordancewithlimitssetbythedirectors.Theamountspresentedinthestatementoffinancialpositionarenetof

61



allowances for doubtful receivables, estimated by the company’s management based on prior experience and their assessment of the current economic environment.

the amount that best represents the company’s maximum exposure to credit risk is made up as follows:

Fully performing past due impaired sh ‘000’ sh ‘000’ sh ‘000’

At 30 June 2011 trade receivables 542,434 - - Bank balances 6,041,743 - -

At 30 June 2010 trade receivables 262,154 - - Bank balances 3,299,308 - -

the customers under the fully performing category are paying their debts as they continue trading. the credit risk associated with thesereceivablesisminimalandtheallowanceforuncollectibleamountsthatthecompanyhasrecognisedinthefinancialstatementsis considered adequate to cover any potentially irrecoverable amounts.

ThecompanyhassignificantconcentrationofcreditriskonamountsduefromKPLCandtheriskofdefaultislow.

Theboardofdirectorssetsthecompany’screditpoliciesandobjectivesandlaysdownparameterswithinwhichthevariousaspectsof credit risk management are operated.

(ii) liquidity risk management

ultimate responsibility for liquidity risk management rests with the company directors, who have built an appropriate liquidity risk management framework for the management of the company’s short, medium and long-term funding and liquidity management requirements.Thecompanymanagesliquidityriskthroughcontinuousmonitoringofforecastsandactualcashflows.

Thetablebelowrepresentscashflowspayablebythecompanyundernon-derivativefinancialliabilitiesbytheirremainingcontractualmaturitiesatthereportingdate.Theamountsdisclosedinthetablearethecontractualundiscountedcashflows,whereasthecom-panymanagestheinherentliquidityriskbasedonexpectedundiscountedcashinflows.Balancesduewithin12monthsequaltheircarryingbalances,astheimpactofdiscountingisnotsignificant.

62


19. FinAnCiAl risk mAnAgemenT (continued)

less than Between 1- over 5 1 month 3 months months total sh ‘000’ sh ‘000’ sh ‘000’ sh ‘000’

At 30 June 2011 trade payables 471,541 - - 471,541

At 30 June 2010 trade payables 441,052 - - 441,052

(iii) market risk

the company manages foreign exchange risk arising from future commercial transactions and recognised assets and liabilities by projectingforexpectedsalesproceedsandmatchingthesamewithexpectedpayments.

At 30 June 2011, if the Kenya shilling had strengthened/weakened by 10% against the us dollar with all other variables held constant, theimpactonprofitbeforetaxfortheyearwouldhavebeenShnil(2010-nil),mainlyasaresultofUSDollartradereceivablesand us dollar bank balances. 10% is the sensitivity rate used when reporting foreign currency risk internally and represents manage-ment’s assessment of the reasonably possible change in exchange rates.

(iv) significant accounting policies

Detailsofthesignificantaccountingpoliciesandmethodsadopted,includingthecriteriaforrecognition,thebasisofmeasurementandthebasisonwhichincomeandexpensesarerecognised,inrespectofeachclassoffinancialasset,financialliabilityandequityinstrumentaredisclosedinnote1tothefinancialstatements.

20. ConTingenT liABiliTies

2011 2010 sh ‘000’ sh ‘000’

contingent liabilities 3,000 -

Theamountrelatestoapendinglegalsuitagainstthecompany.Thedirectors,however,donotanticipatethatanysignificantliabilitywill accrue from this pending suit.

21. CAPiTAl eXPenDiTure CommiTmenTs

2011 2010 sh ‘000’ sh ‘000’

Authorised and contracted for 13,616,000 5,000,956 Authorised but not contracted for 3,696,000 3,696,000 17,312,000 8,696,956

22. inCorPorATion

the company is incorporated in Kenya under the companies Act.

23 cuRRency

ThesefinancialstatementsarepresentedinKenyashillings(Sh).


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2011 2010 sh’000 sh’000 Revenue 940,315 647,190

ADMINISTRATIONEXPENSES-AppendixII 460,592 222,808

PROFITBEFORETAXATION 479,723 424,382

TAXATIONCHARGE (57,815)(35,711)

pRoFit FoR tHe yeAR 421,908 388,671

otheR compRehensive income - -

totAl compReHensive income FoR tHe yeAR 421,908 388,671

detailed statement of comprehensive income FoR the yeAR ended 30 June 2011

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detailed statement of comprehensive income FoR the yeAR ended 30 June 2011

ADMINISTRATIONEXPENSES 2011 2010

sh’000 sh’000

salaries and wages 164,249 70,297

depreciation 84,011 50,230

maintenance cost for transmission lines 50,213 25,000

staff training 28,015 11,759

Board Fees - fees 1,600 1,344

- other 25,812 14,710

Rent 14,371 9,322

staff medical 9,887 3,939

staff Welfare 14,439 1,236

professional fees 8,973 496

Officeexpenses 8,422 3,650

corporate communication 6,631 6,060

postage and telephone and internet services 6,674 1,898

leave pay provision 6,626 -

motor vehicle expenses 6,091 930

printing and stationery 6,165 2,464

membership and subscription 319 1,359

Amortization 1,466 -

staff traveling and accommodation 12,199 16,255

electricity 1,009 171

security 626 405

Bank charges 538 78

Audit Fee 1,999 500

insurances and medical 257 705

460,592 222,808

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ProJeCT nAme sCoPe esTimATeD completion dAte

mombasa - nairobi line 475km, 220/400kv & 2 sub-stations at Rabai and embakasi mar 2013

loiyangalani – suswa line 430km, 400kv line & 2 sub-stations dec 2013

Rabai - malindi - Garsen - lamu line 320km, 220kv line & 3 sub-stations dec 2012

olkaria - suswa 25km, 220kv line & 2 sub-stations mar 2014

sangoro - sondu 5km , 132kv line & 1 sub-station Feb 2012

olkaria - lessos - Kisumu line 300 km, 220kv line & 1 sub-station dec 2014

Kindaruma - mwingi - Garissa line 250km, 132kv line & 2 sub-stations dec 2013lessos - tororo line 127km line, 220 kv & 1 sub-station dec 2013

ethiopia - Kenya 686km, 500kv line & 2 converter sub-stations dec 2014

Zambia- tanzania- Kenya 100km , 400kv line dec 2014

Kilimambogo - thika - Githambo line 57km, 132kv line & 2 sub-stations mar 2012

mumias - Rangala line 34km ,132 kv line & 2 sub-stations mar 2012

nairobi Ring 100km, 400kv line & 5 sub-stations dec 2013

eldoret - Kitale line 60km, 132kv line and 1sub-station dec 2013

Kisii - Awendo line 44km 132kv line & 1sub-station dec 2013

Thika-KiganjoLine 20km,132kV&1Sub-station Mar2012

nanyuki - nyahururu line 79km ,132kv line & 1 sub-stations June 2014

lessos - Kabarnet line 65km 132kv line & 1 sub-station dec 2013

olkaria - narok line 68km 132kv line & 1 sub-station June 2014

Bomet - sotik line 33km, 132kv line & 1sub-station June 2014

mwingi - Kitui – Wote- sultan 153 km 132kv line & 4 sub-stations June 2014hamud - line

ishiara - Kieni line 33km, 132kv line & 1sub-station June 2014

nanyuki-isiolo-meru line 96 km, 132kv line & 1 sub-station Apr 2014

keTrACo ProJeCTs

POWEr EVACuATiOn, rEGiOnAL inTEr - COnnECTOrs, ACCEss & sTrEnGThEninG PrOJECTs

Red - Power evacuation Projects

Black - Regional interconnectors

green - Access & strengthening Projects

key

All the above are vision 2030 Flagship Projects.

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2nd Floor, capitol hill square, chyulu Rd, upper hillp.o. Box 34942 - 00100 nairobi, Kenya.phone: (+254) 20 4956000, mobile: (+254) 719 - 018000, (+254) 732 - 28000email: [email protected]

KETRACO Annual Report

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