Building a Future of
Shared Prosperity

Communication on
Progress Report 2021

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KenGen Sustainability Report F/Year 2021

TABLE OF CONTENTS
1. MANAGING DIRECTOR AND CEO’s STATEMENT

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2. ABOUT KenGen
VisionMissionCore Values
Corporate Theme
Energy Footprint
KenGen’s Energy Generation Mix 2020/2021

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5
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3. HIGHLIGHTS OF 2021

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4. ALIGNING SUSTAINABILITY TO
KenGen’s BUSINESS STRATEGY
Sustainable Development Goals
KenGen’s Membership to the Global Compact
Aligning the Company’s Strategy to SDGs

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5. SUSTAINABLE LEADERSHIP AND GOVERNANCE
Corporate Governance Statement
Statement of Compliance
Principles of Corporate Governance
The Board
The Board Charter
Board Composition
Board Meetings
Board Committees
Succession Management in the Board
The Office of the Inspectorate of State Corporations
Board EffectivenessInduction
Board Development Programme
Board Evaluation
Board Diversity
Number of Board Members Vis-A-Vis Expertise
Conflict of Interest
Executive Committee (ExCo)
Legal and Compliance Audit
Risk Management
Stakeholders Engagement
KenGen’s Commitments in 2022

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6. PEOPLE FIRST
25
Professionally strong and compassionate
26
Human Resource Policy
26
Strength in diversity and inclusivity
27
Persons Living With Disabilities
27
Gender Equality
28
Pink Energy
28Blue Energy Forum30
Young Generation (Y-Gen)30
Training Opportunities; a Journey to Excellence              30Mentoring and Coaching                                                      31E-Learning                                                                              31Skills and Capacity Enhancement
31
Geothermal Centre of Excellence
31
Career Guidelines
32
Succession Management
32
Organisational Health
33
Health, Safety, and Wellness
33
Employee Welfare and Wellness
36
Health and wellbeing38
Our ultra-modern office block – Hydro Plaza
38
Transport Safety
38

7.

Performance Accountability Framework
Industrial Relations
Building an Innovation Culture
KenGen Kept the Promises
KenGen’s Commitments in 2022

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40
40
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SOCIAL IMPACT
KenGen’s Community Engagement Strategy
Livelihood Improvement
Covid-19 Response, Health and KenGen’s
Communities
Ecosystems Restoration and Conservation
Education Scholarships and Learning Support
Addressing Community Water and Sanitation Needs
KenGen’s Commitment in 2022

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8. KenGen’s CLIMATE AMBITION
48
Introduction48
Kenya Climate Strategies in Energy Sector
49
KenGen’s efforts towards Net-Zero Transition
49
KenGen’s Carbon Emission Reductions Portfolio
50
Environmental Sustainability Statement
51
Global Leadership in Climate Change
51
Sustainable Environmental Management
53
Pollution Control and Waste
Management (Wastes Stream)
53
Biodiversity Conservation and Catchment Restoration 54
The 2 billion Trees Campaign
54Partnerships
55
Partnership in Celebrating World Environment Day
55
Partnerships for enhanced conservation
56
Energy efficiency
56
KenGen’s commitment in 2022
58
9. KenGen’s ETHICAL PERSPECTIVE
Introduction
KenGen’s Policies & Procedures
KenGen’s Integrity Structure
KenGen’s resilience towards honest business
Enforcing our stakeholder’s behavior
KenGen’s partners in enhancing ethics and integrity
KenGen’s commitments in 2022

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10. SUSTAINABILITY IN KenGen’s SUPPLY CHAIN
Legal Compliance
Procurement during the COVID-19 Period
Embracing Technology in Procurement
Opportunities and Diversity in our Procurement
Buy Kenya Build Kenya
Value Creation for Sustainability
Stakeholder Management
KenGen’s Commitments in 2022

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11. AWARDS AND RECOGNITIONS

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12. FINANCIAL HIGHLIGHTS

73“Building a future of Shared prosperity “01As a participant in the UNGC since 2019, we hereby disclose
our progress on the implementation of the Ten Principles
and the activities in support of the 2030 Agenda for
Sustainable Development. By embedding the principles
across our operations, we continue to use our knowledge
and skills to make a difference for our stakeholders. We
value our membership and look forward to working together
to ensure that our business is run in a sustainable manner
for the good of current and future generations.
~ Rebecca Miano

Managing Director and CEO, KenGenMANAGING DIRECTOR AND CEO’s STATEMENT
To our stakeholders,
The world economy is making steady progress towards recovery
as we emerge from the COVID-19 crisis which completely
altered the way we do business. As we start to look beyond
it, I am optimistic that we shall continue implementing theTen Principles of the United Nations Global Compact (UNGC)
in the areas of Human Rights, Labor, Environment, Ethics, andGovernance in accelerating the attainment of Sustainable
Development Goals (SDGs).
The KenGen family has demonstrated our values, purpose,
professionalism, and teamwork for sustained positive societal
and environmental outcomes. I am humbled by the countless
positive actions, big and small, that our people have taken
to help each other and the society to tackle the COVID-19
pandemic. As a participant in the UNGC since 2019, we hereby
disclose our progress on the implementation of the Ten
Principles and the activities in support of the 2030 Agenda
for Sustainable Development. By embedding the principles
across our operations, we continue to use our knowledge andskills to make a difference. We value our membership and lookforward to working together to ensure that our business is
run in a sustainable manner for the good of current and future
generations.

We take pride in joining the elite list of
global multinationals and becoming the firstcompany in Kenya’s public sector to commit
ambition for a 1.5-degree campaign.
With this commitment,
KenGen is firmly on thepath towards achievingcarbon neutrality by 2050.
This Communication on Progress Report
describes our actions to integrate the
Global Compact and its principles into KenGen’s businessstrategy, culture, and operations. The annual reporting
increases transparency and accountability and ensures that
we live up to the expectations set by the UNGC and theUnited Nations while showcasing our sustainability ambitions.
We commit to continue sharing this information with our
stakeholders through the Company website and our Integrated
Annual Report and Financial Statements for the year underreview.
I would like to thank the Board of Directors, employees
and other stakeholders for their dedication, resilience, andcommitment to our business sustainability agenda during theyear. We shall continue to live up to our mission and mandate
towards supplying reliable, safe, green and competitively
priced electricity.
Yours Sincerely,

Rebecca Miano, MBS“Building a future of Shared Prosperity “

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ABOUT KenGen
Kenya Electricity Generating Company PLC (KenGen)
was incorporated in 1954 under the Companies Act(Cap 486) as Kenya Power Company Limited (KPC)
and renamed Kenya Electricity Generating Company
Limited (KenGen) in 1998. It is listed on the Nairobi
Securities Exchange with the Government of Kenya
owning 70% shareholding and the public 30%.
KenGen is domiciled in Kenya and has a branch in
Ethiopia.
The Company is propelled by the Good-to-Great
Transformations Strategy that strives to create
sustainable value from generation to generation.
We operate in a liberalized environment and strive to  remain the market leader in the provision of reliable,
quality, safe, and competitively priced electricity todrive the economy as envisioned in the Vision 2030
and the Big Four Agenda.
Backed by a wealth of cutting-edge expertise, KenGen
has distinguished itself as Africa’s leading geothermalenergy producer, which has propelled Kenya into theleague of top ten geothermal power producers in theworld. KenGen also has a strong track record of over 66
years of expertize in running hydropower plants. The
Company pioneered wind generation in East Africa withthe first wind farm in Ngong in the 1990s.

Our total installed capacity is

1,818MW Comprising of:Geothermal

Thermal

713MW

253MW

Hydro

826MW

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KenGen Sustainability Report F/Year 2021

Wind

26MW

VisionTo be the market leader in the provision ofreliable, safe, quality, and competitively priced
electric energy in the Eastern Africa region.

MissionTo efficiently generate competitively priced
electric energy using state-of-the-art technology,
skilled and motivated human resource to ensure
financial success. KenGen shall maintain market
leadership by undertaking the least cost andenvironmentally friendly capacity expansion.

Core Values
Team Spirit

Integrity

Professionalism

Safety CultureCorporate Theme

Build relationship,
resources, capacity,
leadership andhealth.

BUILDBring out the bestin KenGen, a
reputation worth
greatness.

Be present in our
engagement withboth internal andexternal
stakeholders.

BRING OUT
THE BESTBE
PRESENT

Energy Footprint
KenGen’s footprint is in six operational regions:
The Geothermal Region, found in the Rift Valley,
has a total installed capacity of 713MW.
The Eastern Region has five hydro power plants
along the Tana River comprising of Masinga,
Kamburu, Gitaru, Kindaruma, and Kiambere Power
Stations, with a total installed capacity of 600MW.

plant, Muhoroni Gas Turbine, with a total installedcapacity of 60MW. Thermal Region has twothermal plants located in Mombasa County with an
installed capacity of 194MW.
The Upper Tana area comprises of four hydro power
plants: Mesco, Wanjii, Sagana, and Tana. The area
has been developed with an installed capacity of
35MW. Ngong Wind plants are in the Central Office
Region with an installed capacity of 26MW.

The Western Region consists of four hydro power
stations, Turkwel, Sondu Miriu, Sang’oro, and Gogowith an installed capacity of 190MW and a thermal

KenGen Sustainability Report F/Year 2021

05

ABOUT KenGen
KenGen Energy Generation Mix 2020/2021

1%

826MW

26MW

713MW

46%

39%
14%
253MW

KenGen Energy Generation Mix 2020/2021

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KenGen Sustainability Report for Year 2021

HIGHLIGHTS OF 2021
Sustainability

KenGen Sustainability Report for Year 2021

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ALIGNING SUSTAINABILITY TO KenGen’s BUSINESS STRATEGYThe Company’s vision is to be the market leader in theprovision of reliable, safe, quality, and competitively
priced electric energy in the Eastern Africa region. To
achieve this vision and to transform the Company intoa high-performing organization, KenGen embarked
on a “Good-to-Great” (G2G) transformation strategy
in 2007. The strategy was revamped in 2016 withthree aspirations of increasing capacity, value
creation, and providing power at competitive tariffs.
The Company’s sustainability agenda aims at doing
business responsibly, empower future generations,and build a resilient business that weathers turbulent
times while conserving the environment
KenGen invests in people living around the operational
areas through sustainable social and environmental
activities.

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KenGen Sustainability Report for Year 2021

The 2030 UN Agenda for Sustainable Development
gives us a significant role to play in the achievementof the Sustainable Development Goals (SDGs) byembracing wider responsibilities to the environment
in which the Company operates. KenGen has also
embarked on a diversification strategy that stretches
beyond Kenyan borders through sustainable
exploitation of the geothermal resources in Djibouti
and Ethiopia.

Sustainable Development Goals
In 2015, the United Nations proposed the Sustainable
Development Goals (SDGs) be implemented by 2030.
The 17 SDGs are described as “a new plan of action
for people, planet, and prosperity”.

The SDGs agenda has an integrated approach
recognizing that there are deep interconnections
and many cross-cutting elements across the goals
and targets. Embedding sustainability efforts at thecore of Company’s strategy has positively impacted
business perfomance.
KenGen business sustainability practices include:
i. At a minimum, do not harm people or the planet
ii. At best, create value for stakeholdersiii. Focus on improving environmental, social,and governance (ESG) performance in the areas
where the Company operates, and there ispotential for environmental or social impact
from its activities.

KenGen’s Membership to
the Global Compact
The Global Compact Kenya Network was launchedin the Country in 2005 by the United Nations
Development Programme (UNDP). The Company
joined UNGC in May 2019 to accelerate thesustainability efforts and scale up the positiveenvironmental, social, and governance impact acrossthe globe.

Aligning the Company’s Strategy
to SDGs
The KenGen strategy is anchored on three key
aspirations of increasing generating capacity, value
creation to shareholders, and provision of lower
tariffs to support sustainable economic growth.
The three (3) aspirations are realized through seven(7) priority areas/initiatives as follows:
1. Improve returns of current plants.
2. Ensure profitability of future projects.
3. Improve Power Purchase Agreements/Tariff
Regulation.
4. Pursue new financing approaches.
5. Establish new structures to execute and financeprojects.
6. Deliver current project pipeline and access new
geothermal fields.

KenGen Sustainability Report for Year 2021

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ALIGNING SUSTAINABILITY TO KenGen’s BUSINESS STRATEGY
These aspirations and the Seven Priority Initiatives resonate well with the
Sustainable Development Goals as follows:
Capacity Increase
Priority SDG

10Priority Initiative

Key Activities/ Successes

Delivery of current projectpipeline and access to
new geothermal fields.

The pipeline comprises of renewable energy sources
including, Geothermal 87% and Wind 13%. Currently
83.3MW Geothermal plant is under construction.

Delivery of current projectpipeline and access to
new geothermal fields.

Dedicated Environment and Sustainable Development
program to spearhead environmental sustainability.
Registered six (6) CDM projects under the United Nations
Framework Convention on Climate (UNFCCC). Offsetting
approximately 1.5 million tonnes of CO2 equivalent annually and yielding USD 3.627 million since inception andduring the period 2020- 2021, KenGen issued with 4.6
million tonnes of CO2 equivalent.

Improve returns of current
plants (OPEX) to improve
operational processes andstructure

To ensure the sustainability of life underwater, the following measures are in place:•
Conservation of water catchment areas and hydropower dams through desilting and protectionof riparian lands•
Control of water abstraction and usage throughwater permits. 15 permits were acquired from
Water Resource Authority for hydropower generation. KenGen ensured compliance to water
abstraction permit conditions through regularmonitoring.
•
Quarterly clean-up of Makupa shoreline andmangrove planting along the Kenyan coast.

KenGen Communication on Progress Report For Year 2021

Priority SDG

Priority Initiative

Key Activities/ Successes

Delivery of current projectpipeline and access to
new geothermal fields.

Some of the power plants operated by KenGen are in National parks and forest reserves. These sites are habitatsof biodiversity.
Environmental conservation and restoration are key
during the construction and operation of power plants.
Measures put in place include:•
Use of noise silencers at Olkaria Power Plants.
•
Color-blended steam pipes on the animal corridors at Geothermal fields.
•
KenGen issued 181,031 tree seedlings for growing in the operational areas.
•
35 environmental audit reports were submitted
to National Environment Management Authority.
•
All capital projects have Environmental Social
Impact Assessment licenses whose Environmental Management Programmes were monitored
for compliance with license conditions.

Value Creation- Provide adequate return to shareholders
Priority SDG

Priority Initiative

Key Activities/ Successes

Improve Organizational
HealthKenGen is a leading employer, with a staff headcount of
2,552 and attrition of less than 5.7%. Staff Remuneration
stands at USD 86M per annum, which guarantees thepeople and their dependents quality life.
The company promotes empowerment of women, youth,and persons with disability, through the Access to Government Procurement Opportunities Program, the Company allocated USD 43.1M.

“Building a future of Shared Prosperity “

11ALIGNING SUSTAINABILITY TO KenGen’s BUSINESS STRATEGY
Value Creation - Provide adequate return to shareholders
Priority SDG

Priority Initiative

Key Activities/ Successes

Improve Organization
Health (Innovation, ICTInfrastructure)

•

•

•

Improve Organization
HealthRegular drug and substance abuse awareness was done
to employees, families and contractors in collaboration
with National Authority for the Campaign Against Alcoholand Drug Abuse (NACADA).
Promotion of psycho-social health well-being through theengagement of an in-house and external counselors.
•
23 health articles were published and circulated
to employees.
•
HIV and AIDS sensitization programs andinterventions across the company through peer
educators.
•
Health Programs such as a gymnasium at
Stima Plaza II, Eastern and Western regions,and sponsored subscriptions to health clubs topromote staff wellbeing.

Improve Organizational
Health

•

•
•
•

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The Company has developed a digital Innovation
Platform, "Ignite",where staff can shareinnovations. To date, 578 ideas have been
submitted through Ignite.
KenGen undertook various diversification
projects and services: Geoscientific Studies
and Drilling Services in Ethiopia, trained 50
participants at the Geothermal Center of
Excellence on SDGs exploration and developmentof the geothermal resources. Cumulatively
800 participants have been trained since theinception of the Center.
To institutionalize innovation culture, theCompany held the G2G Annual Innovation
Seminar (23 Ideas and 1200 participants) and5 Community of Practice and Innovation forums
across the Company with 43 innovative ideas
presented.

KenGen Communication on Progress Report For Year 2021

From 2019 to 2021, the Company has provided
1,292 training opportunities to the youth to acquire
industry knowledge and experience in various
fields, including Power Plant Operations, Geothermal
Exploration, Corporate Communications, ICT, andengineering.
The Company offered 187 Education Scholarships
for Secondary and University to needy and brightstudents.
The Company also employed Early Childhood
Development Education Teachers and Caretakers for
KenGen ECD Centres.
The Company provided 1,776 textbooks andlearning materials for the learners.

Priority SDG

Priority Initiative

Key Activities/ Successes

Improve Organization
Health••••Improve Organization
HealthThe Pink Energy forum held various meetings todevelop women’s potential, to enable them to makeprogress in professionalism, career growth, health,and wellness.
The Company was awarded the Annual Trailblazers
Award for Gender Mainstreaming category by the
Ministry of Public Service and Gender.
KenGen-sponsored leadership program for Women in
Leadership through Strathmore University.
AGPO Allocations for deliberate procurement
programs targeting women amounted to KShs. 637
million.

70,000 cubic meters worth of water tanks were
distributed to 70 households in Sondu.
233,110,502 cubic meters of water was distributed
to communities through Company water points in theoperation areas.

KenGen hosted the celebration of the National World
Habitat Day at Olkaria Geothermal Spa. The theme of thecelebration was “Accelerating Urban action for a Carbon
Free World.”

Lowering Tariffs - Profitably supplying affordable renewable electricity to the country.
Priority SDG

Priority Initiative

Key Activities/ Successes

Improve Power
Purchase Agreements/
Tariff Regulation••

KenGen is leading the provision of affordable electric
power through low-cost tariffs. KenGen’s average
tariff to Kenya Power stands at Kenya Shillings 5.4
per unit, making it the most affordable compared toother Independent Power Producers in the Country.
KenGen contributes on average 70% of the total
electricity consumed in the Country. This positively
contributes to the improvement of the lives of people
and enhances prosperity.

“Building a future of Shared Prosperity “13Ngong Wind Farm

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KenGen Communication on Progress Report For Year 2021

SUSTAINABLE LEADERSHIP AND GOVERNANCE
PRIORITY SDGs Relevant to Sustainable Leadership and Governance
5.5 Ensure women’s full and effective participation and equal opportunities for leadershipat all levels of decision-making in political, economic, and public life.
5c Adopt and strengthen sound policies and enforceable legislation for the promotion ofgender equality and the empowerment of all women and girls at all levels.

8.5 By 2030, achieve full and productive employment and decent work for all women andmen, including young people and Persons Living With Disabilities, and equal pay for work ofequal value

9.1 Develop quality, reliable, sustainable, and resilient infrastructure, including regional andtrans-border infrastructure, to support economic development and human well-being, witha focus on affordable and equitable access for all.

10.2 By 2030, empower and promote the social, economic, and political inclusion of all,irrespective of age, sex, disability, race, ethnicity, origin, religion, or economic or anotherstatus.
10.3 Ensure equal opportunity and reduce inequalities of outcome by eliminating discriminatory laws, policies, and practices and promoting appropriate legislation, policies, andaction in this regard.
10.4 Adopt policies, especially fiscal, wage, and social protection policies, and progressively
achieve greater equality.
16.6 Develop effective, accountable, and transparent institutions at all levels.
16.7 Ensure responsive, inclusive, participatory, and representative decision-making at alllevels.

KEY PRINCIPLES
Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.
MOST RELEVANT ISSUES
1. Corporate Governance Statement
2. Statement of Compliance3. Principles of Corporate Governance4. The Board
5. The Board Charter
6. Board Composition
7. Board Meetings
8. Board Committees
9. Succession Management in the Board
10. The Office of the Inspectorate of State Corporations
11. Board Effectiveness“Building a future of Shared Prosperity “

15SUSTAINABLE LEADERSHIP AND GOVERNANCE
Corporate Governance Statement

Statement of Compliance

KenGen’s Corporate Governance framework;

As a Company listed in Nairobi Stock Exchange,
KenGen strictly adhere to the continuing obligations incompliance with the Capital Markets Authority (CMA)
Corporate Governance Guidelines – Code of Corporate
Governance Practices for Issuers of Securities to the
Public, 2015 and the ethical standards prescribedin the Company’s Code of Conduct. KenGen also
subscribe to the tenets of governance as provided in
Chapter 6 (Leadership & Integrity) in the Constitutionof Kenya.

•••Defines how the Company is governed, providing
transparency and accountability for decisionmaking.
It provides the basic principles that enable
the Board to provide requisite oversight in therunning of the Company.
It provides guiding principles that lead to explicit
lines of responsibility.

This ensures that the business has appropriate ethicaldecision-making processes and controls to balance
the interests of all stakeholders.
KenGen has instituted systems to ensure that highstandards of corporate governance are maintainedat all levels of the organization. This complies withthe requirements of applicable laws and regulations,
including but not limited to the Capital Markets Act
and Regulations, rules and guidelines thereunder
on Corporate Governance and the Nairobi Securities
Exchange (NSE) regulations, rules, policies, andprocedures.
Corporate Governance matters are described in the2021 Integrated Annual Report and Accounts which
can be found on the corporate website.

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KenGen Communication on Progress Report For Year 2021

At the same time, the Board is guided by theprinciples of good governance as stipulated in thecode of Governance for Government Owned Entities(Mwongozo).
Corporate Governance Audit is regularly conductedby an accredited external governance auditor incompliance with the applicable rules and regulations
set out by the CMA for listed companies.
The Company has adopted ISO Management Systems
as strategic decision-making tools to improveoverall business performance and provide a soundbasis for sustainable development. During the year,
KenGen attained recertification in ISO 9001:2015
Quality Management System and ISO 14001:2015
Environmental Management System. This shows ourdetermination for the pursuit of excellence.

The following are some of the Acts and Regulations KenGen complies to:

03

02

04

CONSTITUTION
OF KENYA,
2010

COMPANIES
ACT, 2015

PUBLIC FINANCE
MANAGEMENT
ACT, 201201

CAPITCAPITAL MARKETSACT, REGULATIONS
C

AP
I
AC T
T,
C
ENERGY ACT,2019

OCCUPATIONAL
SAFETY &HEALTH
ACT, 2007

COMPLIANCEEMPLOYMENTACT, 2007

A Code of Governace
for Government
owned Entities[MWONGOZO]

12ENVIRONMENTAL
MANAGEMENT &COORDINATION
ACT, CAP 387

11

05

STATE
CORPORATIONSACT, CAP 446

10

LEADERSHIP& INTEGRITY
ACT, 2012

06

07

PUBLICPROCUREMENT &ASSET DISPOSAL
ACT, 2015 &REGULATIONS, 2020

08

09

“Building a future of Shared Prosperity “

17SUSTAINABLE LEADERSHIP AND GOVERNANCE
Principles of Corporate Governance

The Corporate Governance principles are entrenched in KenGen’s strategic and operational objectives toaccelerate growth and increase stakeholder value. The Board is ultimately responsible for enhancing Corporate
Governance in the Company.

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KenGen Communication on Progress Report For Year 2021

The Board

Board Composition

The top Management in KenGen is responsible for
Corporate Governance, spearheaded by the Board,
the Managing Director and CEO, the Executive
Committee, and cascaded through the business
operations.

The KenGen Board comprises of eleven (11)members; an independent and Non-Executive
Chairman, one (1) Executive Managing Director andCEO, the Cabinet Secretary-The National Treasury,
Principal Secretary-Ministry of Energy, plus seven(7) independent and Non-Executive Directors. The
Board composition is outlined in the Articles of
Association of the Company.

The Board Charter
The Board is governed by a Board Charter, a
policy document that defines the respective roles,
responsibilities, and authority of the Board of
Directors in setting the direction, and control of
the Company. It is a commitment by members of
the Board to discharge their mandate in KenGen
and outline the rules that guide them. Each
Director subscribes to the Charter and in doing so
acknowledges the Company’s values and commits
to uphold them.
The Charter sets out the powers of the Board
Committees, the separation of roles between the
Board and Management, as well as policies andpractices of the Board in respect to Corporate
Governance matters. The Charter complements anddoes not change or interpret any statute, law, or
regulation.
The Board Charter is the guide in onboarding
new Board Members, forming Board Committees,
induction, remuneration, rotation, training, andconducting of Board meetings.
Board Committee
Audit, Risk & Compliance
Committee

Board Meetings
The Board, as per the Annual Workplan, meetsquarterly or additionally when necessary toconsider matters relating to the overall control ofthe business.
The Board work plan and calendar are prepared at
the beginning of the year and adequate notice,agenda, and Board papers are circulated within the
stipulated timelines.

Board Committees
To effectively execute its oversight role, the Board
has established five (5) Standing Committees
with specifically delegated mandates. The Board
Committees are run with clearly articulated termsof reference as approved by the Board of Directors.

Roles towards Sustainability andBusiness Strategy
To assist the Board in areas of financial
reporting and compliance with theapplicable financial reporting standards,
oversight of the internal and external
audit function, and the operating controls.

Key Achievements·

Reviewed quarterly reports of theInternal Audit & Risk Department.

·

Review quarterly Compliance andGovernance report.

·

Reviewed and recommended to
the Board for approval the audited
financial statements for the year
ended 30th June 2020.

“Building a future of Shared Prosperity “

19SUSTAINABLE LEADERSHIP AND GOVERNANCE
Board Committee
Strategy Committee

Roles towards Sustainability andBusiness Strategy
The Committee reviews and recommends
to the Board matters about the businessstrategic plan, investment decisions, annual business, financial plans, and budgets.

Key Achievements
•
•
•
•
•

Human Resource &Nomination Committee

The Committee is responsible forappointment and reappointment to theBoard and its committees, recruitment,
and performance review of senior
management. It also reviews Human
Resource  policies and Company Staff
Welfare and reward system.

•••
Governance Advisory
Committee

The Committee deals with Governancematters of the Company.

•
•
•
•

Finance Committee

20

The Committee oversees Corporate
Finance and Capital Market matters,
capital raising activities of the Company,
and appraises expenses and investmentsof the company.

KenGen Communication on Progress Report For Year 2021

Reviewed quarterly progress updates
on the G2G Strategy.
Reviewed the proposed 2021/2022
Annual Budget of the Company.
Reviewed quarterly status updates
on KenGen Projects.
Reviewed the quarterly status of the
GoK Performance Contract.
Reviewed quarterly reports on
the performance of Operations,
Geothermal Development, andCorporate and Regulatory Services
Divisions.
Review quarterly reports on theperformance of the Human Resource& Administration Division.
Reviewed and recommended
the required optimum skill set in
the KenGen Board, based on the
expected retirement of incumbent
members.
Reviewed Human Resource Policies.
Reviewed the 2020/2021.
Procurement Plan of the Company
Reviewed the quarterly Procurement
Awards reports.
Reviewed the proposed participation
in Sourcing2Equal Programfacilitated by IFC.
Considered the governance principles
used in the material transactions of
the Company.

•

Receive the Financial Due Diligence
Report and the Balance Sheet
Restructuring, Debt Affordability andSustainability Reports.

•

Oversee the implementation of
the overall investment plan for the
PIBO funds to ensure adequate andcompetitive returns.

•

Review at least semi-annually therepayment of the PIBO funds toensure fulfillment of repayment
obligation; and•Monitoring every quarter, theCompany’s key financial ratios.

Succession Management in
the BoardAs per the Articles of Association of the Company, the
CMA Corporate Guidelines, and Mwongozo (A Code ofGovernance for Government Owned Entities), a third of
the Board of Directors retire at every Annual General
Meeting. Further, any casual vacancy on the Board
is immediately filled, and the Director appointed insuch manner retires at the next AGM for election byshareholders. These mechanisms ensure continuity
in business and continuous refreshing of skills in the
Board.
During the year and as per the Company’s Articles
of Association on Rotation of Directors; three (3)members retired from the Board and were replaced bythree (3) new members of the Board.

The Office of the Inspectorate ofState Corporations
In accordance with Section 18 (2) (c) of the State
Corporation Act, the Inspector General (Corporations)has the powers to attend meetings of any State
Corporation including the Board’s meeting and its
committees. During the year, Mr. Peter Nyutu, Deputy
Inspector General, was appointed to represent theInspector General (Corporation) in all KenGen Board
meetings.

Induction
New members of the Board are inducted to apprisewith an overview of the company, installations,operating environment, and any new developments
as well as any regulatory changes. As part of theinduction program, detailed presentations are madeby management so that the Directors gain a good
sense of the Company operations. They visit KenGen
installations to familiarize themselves with thedifferent modes of power generation. During the year,
three new members of the Board were inducted.
During the year the new Board members were engaged
in an ellaborate induction program and visited various
KenGen installations.

Board Development Programme
Every year, Board members undergo regular capacity
development programs to enhance their knowledge inareas such as Corporate Governance, leadership, andspecialized relevant professional courses. They also
attend energy-related forums and conferences on
best industry practices and Continuous Professional
Development Programs. These measures are geared
towards equipping them with the knowledge thatenables them to fulfil their responsibilities for effective
decision-making. During the year, the Board attended
various courses and conferences and attained therequisite twelve hours on Corporate Governance
Programs as stipulated in the CMA. All KenGen
Directors are members of the Institute of Directors of
Kenya (IOD) for skills and knowledge upscaling.

Board Effectiveness

Board Evaluation

Separation of Powers and Duties

Every year, the Board undergoes a rigorous
Performance Evaluation, conducted by the State
Corporations Advisory Committee. This involves
a 360-degree evaluation of the Chairman by theindividual Directors, each Director by the Chairman,
MD & CEO by all Directors, and peer evaluation of each
Director. The outcome of this evaluation is used tocreate remedial development and training programsfor the Board.

The Chairman and the Managing Director and CEO havedistinct and clearly defined duties and responsibilities.
The separation of the functions of the Chairman(Non-Executive Director) and Managing Director andCEO (Executive Director) supports and ensures theindependence of the Board and Management. The
role of the Chairman is to lead the Board, approvemeeting agenda, promote a culture of open debate,
ensure effective communication with the shareholders
and uphold high standards of Corporate Governance.
The Managing Director and CEO is responsible for theCompany’s day to day management.

Board Diversity
KenGen is proud of the mix of skills, experience,
diversity, and perspectives the Directors bring on
board. It has helped in fostering a culture of inclusion
which is an important attribute as the Company
continues executing the diversity strategy and goals.

“Building a future of Shared Prosperity “

21SUSTAINABLE LEADERSHIP AND GOVERNANCE
Number of Board Members Vis-A-Vis Expertise

KenGen continues to comply with the 2/3 gender parity
rule as outlined in Article 27 (8) and Article 172 (2) of
the Constitution of Kenya. This also contributes to theattainment of the objective of SDG5 on Gender equality.

64%

22

KenGen Communication on Progress Report For Year 2021

36%

Conflict of Interest
The Board fully discloses any real and potential
conflict of interest which comes to the Director’s
attention, whether directly or indirectly. All
business transactions with all parties, Directors, ortheir related parties are carried out at arms’ length.
At the start of all meetings of the Board, theDirectors declare any conflict issues or any interest
they may have in the business under discussion.
The Directors exclude themselves from the quorum
and the vote in respect of any matters in which
they have an interest. No material conflicts werereported by Directors in the year under review.

Executive Committee (ExCo)The Executive Committee is the highest
management leadership organ led by the Managing
Director and CEO and comprises of all the Divisional
Directors. This Committee serves as a link between
the Board and Management. The Executive
Committee has a mandate and responsibility toensure implementation of the Company’s strategic
objectives, compliance with the statutory andregulatory framework, guidelines, and adherence
to company policies and procedures. It convenes its
meetings every week or as the business may dictate
to discuss strategy formulation and implementation,
policy matters, and financial performance.

Legal and Compliance Audit
Enforcement of legal compliance is a key componentof KenGen’s Risk Management Strategy whichseeks to mitigate the Company’s exposure topotential risks. The Company carries out Legal andCompliance Audit every two years to establish thestatus of compliance with statutory, regulatory, andpolicy requirements as well as providing updates
on how the Company and the Board observe anduphold Good Corporate Governance practices in all
its activities. Non-compliance with the law can be
costly to the Company in terms of resources and its
right standing as a responsible corporate citizen.
KenGen’s last Legal and Compliance Audit was
carried out in 2020.

Risk Management
The Company remains committed to robust
risk management as an integral part of strong
governance and good management. The
Board, through its Audit, Risk & Compliance
Committee, exercises its oversight role on theimplementation of Enterprise Risk Management(ERM) processes by management. KenGen has
adopted a Risk Management Framework andhas borrowed from ISO 31000 International Risk
Management Standard, including control activitiesof the Committee of Sponsoring Organizations.
This ensures the strategic and operational risks
are identified, reported, and mitigated consistently.
KenGen review the risk management framework toensure continuous improvement and enhancementof the Company’s risk management processes toremain responsive to the business environment.
We continuously embed risk management in ourbusiness systems, processes, and projects so thatthe responses to risk remain current and dynamic.
KenGen has also adopted the Three Lines Model tocontinue supporting the effective implementationof the ERM framework. The Three Lines Model helps
KenGen to identify structures, processes, roles, andresponsibilities that best assist the achievement ofobjectives and facilitate strong governance and risk
management.

Stakeholders Engagement
Building strong relationships with the stakeholders
give us social capital to deliver on the Company’s
core mandate in line with the long-term values.
KenGen’s Community Engagement Strategy
continues to define the needs of the stakeholders
and the day-to-day relations with the stakeholders
and the communities neighbouring our operational
ecosystem.
While the Company has endeavoured to focus on
enabling manufacturing on the Big Four Agenda,
we have gone a step further to foster the Universal
Healthcare Initiative through the construction of amega Level 5 Hospital in Naivasha. The hospital will
be key in serving the greater Rift Valley Region andcontributing towards the attainment of SDG3 on
good health and wellbeing for all. KenGen continues
to remain intentional about positively impacting thecommunities around us through diverse Stakeholder
Coordination Committees.

KenGen’s commitments in 2022
In the year 2022, we have set out to do andcommit to the following;
1. Hold quarterly Board meetings as per the
Annual Board Workplan.
2. Hold both local and international training for
Board Members.
3. Conclude the Corporate Governance Audit
4. Holding the 2022 AGM.
“Building a future of Shared Prosperity “

23Olkaria Geothermal drilling team in action

24

KenGen Communication on Progress Report For Year 2021

PEOPLE FIRSTHigh Priority UNGC Principles Relevant to Employees

Human Rights

Labourshould support and respect
01 Businessthe protection of internationallyshould uphold the freedom of
03 Businesses
association and the effective recognition

proclaimed human rights

sure that they are not
02 Makecomplicit in human rights abusesof the right to collective bargaining

elimination of all forms of forced and04 Thecompany labour

05 The effective abolition of child labour
elimination of discrimination in
06 Therespect of employment and occupation
High Priority SDG Targets Relevant to Employees
SDG

Target3.8: Achieve universal health coverage, including financial risk protection, access to quality essential healthcare services, and access to safe, effective, quality, and affordable essential medicines and vaccines for all.

4.3: By 2030, ensure equal access for all women and men to affordable and quality technical,
vocational and tertiary education, including university.

8.5: By 2030, achieve full and productive employment and decent work for all women and men,
including young people and Persons Living With Disabilities, and equal pay for work of equal value.

10.2: By 2030, empower and promote the social, economic, and political inclusion of all,irrespective of age, sex, disability, race, ethnicity, origin, religion, or economic or another status.
10.3: Ensure equal opportunity and reduce inequalities of outcome, including by eliminating
discriminatory laws, policies, and practices and promoting appropriate legislation, policies, andaction in this regard.
10.4: Adopt policies, especially fiscal, wage, and social protection policies, and progressively
achieve greater equality.

“Building a future of Shared Prosperity “

25PEOPLE FIRST
Professionally strong
and compassionate
KenGen is an equal opportunity employer that
upholds the rights of every person as stipulated in
the Human Resource Policy on recruitment, selection,
appointment, and promotions, and in line with theUnited Nations Global Compact (UNGC) principles
on Human Rights and Labour as well as Sustainable
Development Goals (SDGs).
The Company deliberately ensures all business units
have appropriate representation of work experience,expertise and gender, to enhance capacity andproductivity.

26

KenGen Communication on Progress Report For Year 2021

During the year, the Company had a complement of
2,552 employees spread across all business areas
in Kenya, Ethiopia, and Djibouti. The turnover rate
stood at 5.7%, which is less than the global averageof 10.9%, owing to the comprehensive employee
retention programs in place.

Human Resource Policy
The Human Resource Policy ensures employee rights
are protected and proper benefits provided for theirwork. The policy has helped in addressing complaints,
problems, and grievances. This is in line with the
UNGC principle 10.4: ‘Adopt policies, especially fiscal,
wage and social protection policies, and progressively
achieve greater equality.

Balanced &Productive Work Time
Balanced working hours
result in a productive
environment

Fair Renumeration
Fair salaries lead toemployee motivation

02

Wellness, Wellbeing,
Health, & Safety
The proper infrastructureof health and safety at
the workplace

Strengthininclusivity

HUMAN
RESOURCEPILLARS

01

04

Pillars of Successful
HR Strategy

03

diversity

05

andKenGen believes in diversity and inclusivity
irrespective of gender, physical ability, ethnicity,
or age. In line with the Human Resource policy on
Gender Mainstreaming, Gender Equality (SDG5),
and Reduced Inequalities (SDG10), the Company  
is committed to ensuring gender equality at theworkplace.
Equally, the policy on diversity stipulates theresolve to recognize and appreciate the uniquebeliefs, values, skills, attributes, and characteristics
of all employees in an environment that promotes
an all-inclusive representation of people.

Effective Team
CultureEmployee friendly work
environment results in
productivity

Rewarding Career
A rewarding careeris a motivator

Persons Living With Disabilities
Not disabled, just differently-abled

KenGen is committed to ensuring that thepeople living with disabilities are accorded equal
opportunities at the workplace, including equal
employment opportunities. The Company has
provided facilities to accommodate them andensures adherence to provisions of the Persons
Living With Disability Act and other laws andregulations governing Persons With Disabilities(PWDs).
Currently, 1.1% of all employees are PWDs. To
ensure better interaction among all employees,
the Company has trained 31 employees in basic
sign language, 234 on disability awareness, andfacilitated an accessibility audit by the National
Council for People with Disability (NCPWD) at“Building a future of Shared Prosperity “

27PEOPLE FIRSTGender Equality
The company has made a deliberate effort to meet the two-third gender requirement. In the last two years, theratio of women to men increased from 23.3% to 24.5%. While KenGen is proud of the progress made towards
gender parity, the Company recognizes that there is more work to do to attain gender equality sooner than laterby deliberately recruiting more women under affirmative action to meet the threshold of not less than 30%
representation of either gender in the workplace.

FEMALE EMPLOYEESMALE EMPLOYEES

24.5%

77%

77%
76%
75%

24%

23%

23%

2018

2019

2020

2021

2018

2019

2020

2021

KenGen is committed to increasing the numbers through partnering with institutions such as the Institution ofEngineers of Kenya Women Engineers chapter, Kenya Association of Manufacturing; Women in Manufacturing,the Brands and Beyond Women in Energy Awards, Women in Engineering South Africa, Women in STEM launchin Makueni, a rural region, amongst others.

Pink Energy
To accelerate the resolve for gender parity, a forum dubbed Pink Energy, aimed at empowering female employees
was established. Through the forum, several milestones have been achieved including the creation of a conducive
work environment for women, raising gender awareness, and helping institute gender mainstreaming acrossthe company.
The company is partnering with the UN Global Compact and USAID intargeted programs aimed to deepen the implementation of the Women’s
Empowerment Principles (WEPs) and to strengthen the contribution to SDG 5,
which calls for women’s full participation and equal leadership opportunities,
including in economic life, by 2030. After completion of the WEP tool Gender
Gap assessment, the Company achieved a score of 58%, which is noted as anachiever on Gender Equality matters.

28

KenGen Communication on Progress Report For Year 2021

KenGenResults, Completed on: September 16, 2021
AchieverYour Score Is

Well Done! Your company has developed and implemented
several policies and practices across business functions ofyour organization. Your company recognizes that while
formalizing policies is important, in order to create change youneed to support those policies with practice, measurement,
and reporting. The next step are to address the remaining gaps
in your implementation, fully integrate, and increase yourtrasparency to your stakeholders, and you will become a true
leader on gender equality!

58%
Beginner

ImproverAchieverLeader0-25%

25-50%

25-50%

75-100%

58%
0

25

50

75

100

KenGen results after Women Empoweremnt Program Gender Gap assessment

Prof. Margaret Kobia, Cabinet Secretary, Ministry of Public Service and Gender Affairs presentsan ‘Annual Trailblazers Award for Gender Mainstreaming category’ to KenGen in recognition of its
effort on Gender Mainstreaming and Women Empowerment through the Pink Energy initiative.

Annual Trailblazers Award for gender mainstreaming category“Building a future of Shared Prosperity “

29PEOPLE FIRSTBlue Energy ForumTo address some of the issues
affecting men, the Blue Energy
forum was established, withmembership drawn from all male
employees. This is a platformthat helps men address issues
that revolve around career,investments, family, relationships,
lifestyle, among others, to bring
the best out of them.

Mwanaume ni......

Honor

Duty

Care

THANK YOU for attending
the “Kwa Kinyozi”
virtual chat!

Several talks have been organized,with the latest one dubbed “Kwa
Kinyozi”, held in November 2021,
with a total of 169 participants.

Young Generation (Y-Gen)To address issues affecting the young employees in the Company, Young Generation (Y-Gen) forum wasestablished. The main purpose of this forum is to maximize the potential of employees who are 35 years ofage and below, towards performance excellence and ultimately achieve the G2G (Generation to Generation)
strategy.
The Young SDG Innovators Program provides an opportunity for participating companies of the UN Global Compact
to identify young talent within their organizations, collaborate, and accelerate business innovation towards
the Sustainable Development Goals (SDGs). Towards this end, KenGen participated in a 10-month accelerator
program to develop and drive innovative solutions through new technologies, initiatives, and business models
and deliver on the company’s sustainability objectives.

Training Opportunities; a Journey to Excellence.
The Company is committed to the provision of quality training to all employees to enhance their performance.
Considering the austerity measures instituted in the wake of the COVID-19 pandemic, it is almost certain wemust approach learning and development differently, taking into consideration that skills shelf life is short, withresearch indicating that 53% of employee skills become obsolete within three years.
KenGen is therefore committed to reskilling and upskilling employees for improved performance, considering
global digitalization and technology.

KES

180m
Training Budget
FY2020/2021

30

KenGen Communication on Progress Report For Year 2021

1,399
Number of Employees
who benefitedMentoring and Coaching
Recognizing the importance of coaching and mentorship in making the employees more valuable andskillful, the Company has developed a comprehensive policy on learning and development that incorporates
the identification of employees for coaching and mentoring programs. 80 mentors and coaches were
nominated based on experience, performance, and emotional intelligence and trained in the process.

E-Learning
To enhance the employee skills andcompetencies and address challenges
brought about by the COVID-19
pandemic, the Company implemented
blended learning by introducing
e-learning to complement in-personclassroom training. The Company
introduced competencies e-lab, an
online learning platform that offers
training content and services with
100% cloud access, anytime, anywhere.
As a result of these interventions,
KenGen enhanced the competency of
1,399 employees.

Tutorial

Creativity

Education

To promote knowledge management
among the people, the Company held
the G2G Annual Innovation Seminarand four Communities of Practice andInnovation (COPI) forums during theyear.

Knowledge

WebinarCoaching

Skills and Capacity Enhancement
KenGen recognize the importance of fundamental skills such as critical thinking, problem-solving, anddecision-making in preparation for the future work environment. These are the building blocks that
help employees identify changes in the environment quickly and adapt response strategies, targeted at
producing the desired outcome.

Geothermal Centre of Excellence
Geothermal Centre of Excellence was established in 2006 to offer  various courses relating to Geothermal
Resource Development. Since its inception, over 800 participants have been trained at the Centre.
The annual Sustainable Development Goals (SDG) Short Course on Exploration and Development ofGeothermal Resources 2021 program was conducted with 50 participants graduating on 4th December
2021.
The program is a partnership between UNESCO GRÓ Geothermal Training Programme (GRÓ GTP), Iceland,
KenGen, and Geothermal Development Company (GDC). This is to build a pool of specialists in Geothermal
Resource Development in the Continent, through capacity building, in line with the Sustainable
Development Goals (SDG No. 7) on “access to affordable, clean and reliable energy.

“Building a future of Shared Prosperity “

31PEOPLE FIRST
Career Guidelines
Informed Choices for the
FutureThe Company has developed arobust career framework that
addresses skills gaps, skills growth,and employee general careerdevelopment.
Thisframework
defines, attracts, motivates, andfacilitates the retention of critical andsupport skills required for business
operations. To guide the Company inthe acquisition and management of
talent, career progression guidelines
were published and disseminated.
Further, skills gap analysis and careerconversations were conducted tohelp employees manage their careers
better.

SUCCESS
MOTIVATIONCAREERLADDERCAREERGUIDELINESGOALSCHECKLISTQUALIFICATIONSWOTEDUCATION

Succession Management
Your future is created by what you do today, not tomorrow
To ensure that the Company has the requisite bench strength for the operations from generation to generation,
we have developed a policy on succession planning. The policy is supported by leadership development andother performance enhancement programs that are aligned with the Human Resource Development strategies.
Mentorship and coaching are important elements of the succession planning process and various programs havebeen rolled out.

32

IDENTIFYASSESSDEVELOP

Needs
Goals

Candidates
Gaps

Abilities
SupportDOCUMENT

TRANSITION

Current Skills
Future Skills

PeopleRoles

KenGen Communication on Progress Report For Year 2021

Organisational HealthOrganization, no matter how well designed, is only as good as
the people who work in it
During the year, the Company conducted an Organisational Health assessment, and the overall index was
70%. The leadership is keen to ensure it abides by its commitment to address the issues and gaps identified
through this survey by implementing the survey recommendations.
Activity

Focus Area/Activity

1

Run quarterly meetings to review training and development interventions.

2

Implement 70:20:10 training philosophy.

3

100% return rate on Performance Management Appraisal by 2022.

4

Start Personal Improvement Plan (PIP) for staff with performance challenges.

5

Continuously carry out and implement training needs assessment based on the relevant competencies.

6

Implement departmental learning hours to encourage the exchange of knowledge amongst employees.

7

Conduct informal forums and staff retreats to strengthen staff relationships and build trust.

8

Review processes and identify synergies to drive efficiencies and effective ways of working.

9

Continuously create awareness on existing gender and women empowerment policy.

10Consider instituting forums for male employees and other employee affinity groups (Pink Energy, Blue
Energy, and Y-Gen).

11

Integration of gender parity targets in the company strategy to drive diversity and create a plan toachieve this.

12

Partnership programs with academic institutions that sponsor women to take up the technical courses.

Health, Safety, and Wellness
Response to the COVID-19 pandemic
With the emergence of the COVID-19 pandemic,
the Company ensured that employees remained
resilient, agile, and committed to ensuring theavailability of reliable power to support healthservices and other sectors and the economy.
KenGen’s Medicare Scheme was enhanced tocover testing and treatment costs associated with
COVID-19 and professional counselling services
procured to deal with the emerging mental healthand psychosocial issues. During the period, weekly
voluntary COVID-19 testing was facilitated at all
the operational areas in partnership with various
service providers and addressed the fears, concerns,
and stigmatisation associated with COVID-19.

The Company also organised vaccination for
employees and family members, service providers,and communities around us and encouraged healthyliving by eating the right food and exercising.
This has borne fruit with over 85% of the people
vaccinated, compared to the national rate of 20%.
To ensure provision of the necessary personal
protective equipment and vaccination of employees,
a business continuity strategy was activatedthat included the appointment of the Executive
Committee, Executive Support Team, Corporate
Crisis Management Team, and Regional Corporate
Management Team to work in conjunction with the
Ministry of Health.

“Building a future of Shared Prosperity “

33PEOPLE FIRST

KenGen
EMERGENCYRESPONSESTRUCTURE

EXECUTIVE
COMMITTEEEXECUTIVESUPPORT TEAMCORPORATE CRISISMANAGEMENT TEAMREGIONAL CORPORATECRISIS MANAGEMENT
TEAM

and

D
COVID-19
M

H

P

e

G
newsletter

34

KenGen Communication on Progress Report For Year 2021

C

COVID-19P

Other measures instituted include;
remote working, staggered shift rotas,
virtual meetings, social distancing
in the offices, restriction of physicalinteractions to only critical andessential services, restricted accessof office premises by external parties,
provision of hand sanitizers and facemasks to employees, and frequent
deep cleaning and fumigation of all
office premises.

“Building a future of Shared Prosperity “

35PEOPLE FIRST
Employee Welfare and Wellness
KenGen’ s People
Mortgage and Car loan Facilities
Recognizing the need to improve the people’s
welfare and retention strategies, the Company
implemented a mortgage and car loan scheme in2013. The scheme is funded by the Company andpartnering with KCB Bank and Stima Sacco Society
as administrators.
To date, over KShs 1 billion has been disbursed
to finance house purchases, construction, andacquisition of personal cars.

Health and wellbeing
Creating a safety culture is the foundation forsustainable business and support for the vision of
becoming a market leader in the provision of reliable,safe, quality and competitively priced electricalenergy.
KenGen is committed to providing and maintaining
work conditions, equipment, and systems of work
which are safe and healthy for all the employees andother stakeholders including, contractors, visitors,
and persons at or near the operational areas.

This is in line with Sustainable Development Goal 3,
regarding “Good Health and Well-being”.
Promoting safety culture in the workplace andundertaking reasonable and practical Health and
Safety measures is anchored in the core values,
Human Resource Policy on Health, Safety, andEnvironment and Occupational Health and Safety Act
2007.

Providing employeeswith appropriate
Personal Protective
Equipment (PPE)provides additional
protection to workers
exposed to workplace
hazards
This is aligned zeroaccident target within
KenGen’s facilities.

36

KenGen Communication on Progress Report For Year 2021

Safety and
Health Training

Management
Commitment
and Employee
Involvement

HazardPrevention
and Control

Figure 1: Commemoration of World Day of Remembrance forRoad Traffic Victims

KenGen staff during a safety training“Building a future of Shared Prosperity “

37PEOPLE FIRSTOur ultra-modern office block – Hydro Plaza

Transport Safety
KenGen is committed to providing an efficient,reliable, and cost-effective transport systemthat supports the operations as stipulated in theTransport Management Policy. The policy emphasizes
adherence to safety requirements, compliance withapplicable legal and statutory regulations, optimum
fleet size, selection and configuration determined byoperational needs, operation and maintenance38

KenGen Communication on Progress Report For Year 2021

process optimization, effective and efficientmanagement of drivers, workshops, equipment, fleet,and accessories.
To ensure proper use and safety of the 396 motor
vehicles, KenGen has installed a motor vehicle
tracking system that monitors vehicle movement inreal-time, fuel consumption, and maintenance.

Performance Accountability Framework
KenGen has a robust performance management system which is key in monitoring employee performance at alllevels. Performance contracts are signed with the Government of Kenya and cascaded through the managementlevels. Monitoring of these targets against Key Performance Indicators set is done weekly while evaluation isbi-annual. The Company’s performance management policy guides the process.

Performance Management Process“Building a future of Shared Prosperity “

39PEOPLE FIRST
Industrial Relations
In living the spirit of one of the themes  “building relationships”, the Company recognises Kenya Electrical Tradeand Allied Workers Union (KETAWU) as a representative of employees. This has provided an environment toarticulate people’s issues within the Union through a mutually acceptable recognition agreement that legitimises
joint negotiation and consultation as a mechanism for fostering cooperation and mutual understanding between
the parties.
As a result, the Company and KETAWU have amicably negotiated and implemented various collective Labour
Agreements about terms and conditions of employment, health, safety, and environment at the workplace andother matters of mutual interest to the Company and the people.

Building An Innovation Culture

In this ever-changing world, no organisation cansurvive without innovation. This is the lifeline thatdrives business today as KenGen continually seeks
ways to create and improve its business models
and practices. The innovative nature and resilienceof the workforce are showcased at the annual G2GInnovation Seminar which successfully exploits
new ideas that improve our business processes andembrace new solutions.
This innovative corporate culture has given us
a distinct competitive edge which is driving thediversification agenda. As   a result , the Company
has been awarded Geothermal Drilling Contracts inEthiopia and Djibouti. KenGen prides itself in that theemployees solely learn the contracts with skills andexpertise grown within KenGen.

40

KenGen Communication on Progress Report For Year 2021

KenGen has secured the intellectual property against
possible violations by partnering with the Kenya
Industrial Property Institute and administering nondisclosure agreements.
The    Internet   of Things (IoT) revolution has
undoubtedly arrived and permeated all sectors. IoT
is one of the main drivers of the ongoing digital
adaptations that are radically changing the way
KenGen does business. The Company is resetting
digitally to attain the value proposition of efficientbusiness
processes,
increased
productivity,
alternative revenue and cost savings, increased
compliance and data protection and customer
satisfaction.

KenGen Kept the Promises
2020 Commitment

Achievements

Working with the World Bank to develop a
Gender Strategy.

Gender Strategy developed, awaiting approval.

KenGen has been selected to participate inPower Africa’s engendering utilities program.

Participated fully.

KenGen shall continue developing
partnerships with like-minded institutions tocontinue empowering women.

Partnership with UNGC, World Bank, Institution of Engineersof Kenya Women Engineers Chapter, Kenya Association of
Manufacturers, Women in Engineering South Africa.

KenGen shall continue monitoring thepercentage of women within its suppliers andsubcontractor database to expand women’s
participation particularly in non-traditional
categories of supplies.

KenGen continued to engage women suppliers during theperiod. However, due to the COVID- 19 pandemic there was a
38% reduction in the value of contracts awarded .

KenGen shall engage in increased coaching,mentorship, and personal development toenable women to reach greater heights.

80 Mentors and Coaches trained.

As the organisation continues to monitor
statistical data on women, the Company shallcontinue to take action to increase the number of women in senior positions.

Executive position representation increased from 20 to 40%.

More partnerships to improve the livelihoodsof women and women’s participation in STEM
being an Engineering Company.

Partnership with UNGC, World Bank, Institution of Engineersof Kenya Women Engineers Chapter, Kenya Association of
Manufacturers and Women in Engineering South Africa.

Continue enhancing gender awareness leading to a more suitable workplace for women.

Pink Energy forum for women activities continued culminatingin ‘Annual Trailblazers Award for Gender Mainstreaming
Category’ in Kenya.

KenGen’s Commitments in 2022
In the year 2022, we have set out to do and commit to the following;1.

Approve and implement the Gender Strategy.

2.

Continued implementation of UNGC principles and SDGs.

3.

More partnerships to improve the livelihoods of women and women’s participation in STEM.

4.

Embrace Artificial intelligence and innovation.

5.

Implementation of a leadership development framework

6.

Institutionalize succession management.

7.

Embed Coaching & mentorship programs.

8.

Implement a Fleet management system (Lot II– fuel management solution) to optimize transport costs.

“Building a future of Shared Prosperity “41Tree Planting exercise at Koguta Forest in Sondu, Western Region

42

KenGen Communication on Progress Report For Year 2021

SOCIAL IMPACTPRIORITY SDGs
3.8 Achieve universal health coverage, including financial risk protection, access to quality
essential healthcare services, and access to safe, effective, quality, and affordable essential
medicines and vaccines for all.

4.3  By 2030, ensure equal access for all women and men to affordable and quality technical,
vocational and tertiary education, including university.

6.1 By 2030, achieve universal and equitable access to safe and affordable drinking water
for all.

15.1 By 2020, ensure the conservation, restoration, and sustainable use of terrestrial andinland freshwater ecosystems and their services, in particular forests, wetlands, mountains,and drylands, in line with obligations under international agreements.
15.4 By 2030, ensure the conservation of mountain ecosystems, including their biodiversity,
to enhance their capacity to provide benefits that are essential for sustainable development.

16.6 Develop effective, accountable, and transparent institutions at all levels.
16.7 Ensure responsive, inclusive, participatory, and representative decision-making at alllevels.

KEY PRINCIPLES
Human Rights

Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights

LabourPrinciple 6: Businesses should uphold the elimination of discrimination in respect of employment and occupation.

Environment

Principle 9: Businesses should encourage the development and diffusion of environmentallyfriendly technologies.

MOST RELEVANT ISSUES
1.
2.
3.
4.
5.
6.

KenGen’s Community Engagement Strategy
Livelihood Improvement
COVID-19 Response, Health, and the Communities
Ecosystems Restoration and Conservation
Education Scholarships and Learning Support
Addressing Community Water and Sanitation Needs“Building a future of Shared Prosperity “

43

SOCIAL IMPACT
KenGen’s Community Engagement
Strategy

COVID-19 Response, Health andCommunities

The Company’s Community Engagement Strategy
has nine (9) dimensions anchored on three (3) pillars,
namely:1. Good to Great from Generation to Generation
2. Sustainable Value Creation
3.  Social License to Operate

While the rapid development of vaccines against
COVID-19 is an extraordinary achievement,
successfully vaccinating the national population andespecially the vulnerable, presents many challenges.

During the year under review, a draft Stakeholder
Engagement Policy was developed, awaiting review
and submission for approval.

eC
Va
lu
ble
na
sta
i
Su

e
rat

pe

-

Independence

Affordable,
Reliable
Access toEnergyChampion
Community
InterestsoOetSustainable
Operations

ns

Collaborative
Commercial
Capacity Success Protection
Building andof Culture/
Education
Lifestyle

ice

lL

cia

rea
tio

So

n

Unity

Land

Good-to-Great from Generation to Generation

Livelihood improvement

During the onset of the pandemic, the Company’s
COVID-19 preventive measures in its operational
areas included a donation of KShs.32 million for thepurchase and distribution of Personal Protective
Equipment including hand sanitizers, liquid soap,
water tanks, and medicine, and also assorted fooditems to households affected by the pandemic.
KenGen’s efforts also incorporated a sustained
awareness campaign, which promoted good
handwashing behaviour, hygiene, social distancing,
and the use of facemasks for its employees and thecommunity the Company interacts with.
During the year, KenGen actively participated inits continued support of vulnerable groups byparticipating in international day activities such as
World Aids Day and World Malaria Day.
Additionally, the repair of Lorogon Dispensary in
Turkwel and completion of construction of Naivasha
Level-5 Hospital were funded by the Company inpartnership with the County Government of Nakuru.
The project will contribute immensely to the Country’s
health sector.

As KenGen sustains the Corporate Social Investment
programs, the Company is alive to the emerging
issues that were affecting ordinary Kenyans andcommunities during these challenging times.
KenGen’s existing CSI structures quickly adapted
to the new normal as the basis of the stakeholders’engagement agenda. The KenGen Foundation’ssustainable pillars of Environment, Education,and Water and Sanitation were established forthe strongest impacts on the livelihoods of thecommunities and Kenyans who the Company interacts
with.

KenGen team giving out face masks toa school in Western Region

44

KenGen Communication on Progress Report For Year 2021

KenGen Foundation Managing Trustee receiving book donation from KenGen Managing Director and CEO

Ecosystems
Conservation

Restoration

andThe continuous negative trends in environmental
degradation may be seen as a slower-moving crisis
than the speed of the global pandemic, but its longterm effects are likely to be far more threatening.
Ecosystem restoration remains a key priority for
KenGen to manage the unavoidable impacts of climatechange and build the resilience of communities thatwill be most impacted.
The Schools’ Green Initiative Challenge is a flagshipconservation project,
spearheaded by KenGen
Foundation, in partnership with the Ministry of
Education and Better Globe Forestry Limited. In theyear under review, 28 news schools in Turkana andWest Pokot Counties, and 100 new schools in Eastern
Region were enrolled in the program. 256 new ‘green’
teachers were trained on the basics of environmental
conservation for dissemination to over 2,000 Primaryand Secondary School students.

Currently, in Phase VI, the GIC is an ongoing programthat has so far seen the greening of over 380 acres in
600 school Compounds with approximately 180,000
drought-resistant tree species since 2015, especiallyin the semi-arid Counties of Kitui, Machakos, andEmbu.
Likewise, KenGen employees joined hands with othercorporates through the Company’s Employee Giver
Initiative to address forest and vegetation cover loss
at Nairobi National Park, Eburru Forest, and Koguta
Forest by planting 20,000 trees for climate change
mitigation. The Company’s afforestation efforts werebacked up by an additional 181,031 trees planted
through its power stations community engagement
initiatives.
Additionally, KenGen marked key international dayson environment such as World International Desert
and Desertification Day and World Environment Day
as a show of solidarity with the global community inclimate change mitigation and adaptation.

“Building a future of Shared Prosperity “

45

SOCIAL IMPACT

Sondu Miriu Community members in Western Kenya receive water tanks funded by KenGen Foundation

Education
Scholarships
Learning SupportandSince 2005, KenGen has invested in education
scholarships for tomorrow’s leaders with over 700
students benefiting from the program by the year
2021. This is in line with Sustainable Development
Goal 4 of ensuring inclusive and equitable quality
education.
During the Annual Books Drive, over, 1,776 books
for charity were collected, spearheaded by KenGen
Foundation, to complement the achievement of theeducation scholarship program of the Corporate Social
Investment. Currently, the Company is sponsoring 187
students through Secondary School and University.
With the explicit mandate in providing national
infrastructure support, the Company continued its
investments in improving learning conditions in
preparation for post-pandemic recovery through theconstruction of classrooms and a library at Kajiado,
West Pokot and Mandera Counties to benefit morethan 2,000 students.

Addressing Community Water andSanitation Needs
Access to water, sanitation, and hygiene (WASH)
services, which are crucial in curbing the spreadof COVID-19 risked disruption through lockdown

46

KenGen Communication on Progress Report For Year 2021

measures and other related protocol, posing further
threats to the livelihood of communities. Safely
managed WASH services are also critical during therecovery phase of a disease outbreak to mitigate
secondary impact on community livelihoods andwellbeing.
Through the KenGen Foundation, water tanks oftotal capacity of 70,000 m3 were distributed to
70 vulnerable households at Sondu Miriu, with anadditional 300,000 m3 earmarked for the Olkaria
community.
During the vulnerable period under review, theCompany also supplied vulnerable communities with
233,110,502m3 of water through its community
water points and the supply of water tanks.

KenGen’s Commitments in 2022
In the year 2022, we have set out to do and commit
to the following;• Enhance Public Relations and Stakeholder
Engagement.
• Enhance Community Engagement.
• Enhance Corporate Social Investments through
KenGen Foundation.
• 100 schools within our areas of operation to
be enrolled in   the Schools   Green Initiative
program.
• Implement the Corporate Social Responsibility(CSR) plan.

Ngong Wind Farm

“Building a future of Shared Prosperity “

47

KenGen’s CLIMATE AMBITIONPRIORITY SDGs
Target 13.2 Integrate climate change measures into national policies, strategies, andplanning

Target 15.1: By 2020, ensure the conservation, restoration, and sustainable use ofterrestrial and inland freshwater ecosystems and their services, in particular forests,
wetlands, mountains, and drylands, in line with obligations under international agreements.

KEY PRINCIPLES
Environment

Principle 7: Businesses should support a precautionary approach to environmental
challenges;
Principle 8: undertake initiatives to promote greater environmental responsibility; andPrinciple 9: Businesses should encourage the development and diffusion ofenvironmentally friendly technologies

MOST RELEVANT ISSUES
1. Kenya Climate Strategies in Energy Sector
2. KenGen’s efforts towards Net-Zero transition
3. KenGen’s  efforts towards Net-Zero transition
4. KenGen’s Carbon Emission Reductions Portfolio
5. Environmental Sustainability Statement
6. Global Leadership in Climate Change
7. Sustainable Environmental Management
8. Projects appraisals and Monitoring
9. Biodiversity Conservation and Catchment Restoration
10. Partnership in Celebrating World Environment Celebrations

Introduction
The UN Global Compact has designated this decade the “decade to deliver” on the UN SDGs and the promiseof a greener, more equitable future. Meaningful climate action requires collaboration between stakeholders
including government, multinational organizations and development partners. The Company is committed to thedevelopment of renewable power projects that create value for the Nation considering that energy is an enablerof the socio-economic pillar of Kenya’s Vision 2030 national blueprint. The energy sector is the most significant
contributor to GreenHouse Gas emissions (GHG) globally and is responsible for nearly three-quarters of humancaused greenhouse gas emissions.
These emissions must be reduced substantially while ensuring energy for all. This is vital in accelerating theattainment of Sustainable Development Goal 7, aimed at ensuring access to affordable, reliable, sustainable, andmodern energy for all, and Goal 13 aimed at combating climate change and its impacts.

48

KenGen Communication on Progress Report For Year 2021

Kenya Climate Strategies in Energy
Sectortherefore, seeks to ensure an electricity supply mix
based mainly on renewable energy that is resilient toclimate change.

In December 2015, the Paris Agreement (PA) was
adopted at the 21st Conference of the Parties (COP 21)of the UNFCCC in Paris. The PA charts a new course in
the global climate effort by building upon the UNFCCC
and, for the first time, bringing nearly all nations into
a common cause in combatting climate change. The
PA’s central aim is to strengthen the global responseto the threat of climate change by keeping a global
temperature rise this century well below 2°C above
pre-industrial levels and to pursue efforts to limit thetemperature increase even further to 1.5°C throughlow carbon development.

The actions to achieve this objective are throughthe development of 2,405MW of new renewables(Geothermal: 913MW, Solar: 442MW, Hydro: 93MW,
Wind: 800MW, Biomass/Biogas: 157MW, andDistributed solar and mini-grids: 30MW) by 2022.

Parties are required to undertake and communicate
ambitious efforts to contribute to the achievementof these goals in the form of Nationally Determined
Contributions (NDCs) communicated to the UNFCCC.
Kenya’s NDC, which was submitted to the United
Nations Framework Convention on Climate Change(UNFCCC), includes mitigation and adaptation actions.
Kenya is committed to tackling climate change and has
pledged through its updated NDC submitted to the
UNFCCC in December 2020 to reduce greenhouse gas(GHG) emissions by 32% by 2030. This pledge focuses
on Energy Sector as one of the key contributing
sector by deploying more renewable energy sources
especially geothermal, solar, and wind.
Climate change impacts has been experienced in
Kenya and notably in the Energy Sector where theCompany has experienced prolonged droughts which
led to electricity outages. Clean and sustainableenergy is therefore essential for Kenya’s sustainable
development and is considered one of theinfrastructure enablers of the socio-economic pillar of
Vision 2030.
The National Climate Change Action Plan (NCCAP-2018-2022), the tool to implement Kenya’s NDC,
indicates that Kenya’s energy sector contribution
to GHG emissions is expected to increase sharply
from 2015 to 2030. The energy sector (excludingtransport and industry), accounted for 7.1% of total
emissions in 2015 and is projected to rise to 29.7%
of total emissions in 2030. The NCCAP 2018-2022,

KenGen’s Efforts Towards Net-Zero
Transition
The pledge to reduce GreenHouse Gas (GHG)
emissions by 32% by 2030 focuses on the Energy
sector as one of the key contributing sectors throughthe deployment of more renewable energy sources
especially geothermal, solar, and wind.
KenGen has adopted a green energy strategy inexpanding its generation with an emphasis on
renewable sources such as geothermal, hydro, wind,and solar. This is a critical role in moving Kenya
towards a green economy trajectory. Currently, theCompany is developing an 83.3MW Olkaria I Unit 6
Geothermal plant and undertaking rehabilitation andupgrade of Wanjii Hydro Power Station to 9.6MW.
KenGen has committed to aligning its activities to theambition of keeping warming to 1.5°C through theimplementation of renewable energy projects that
contribute to emissions reductions, considering thatover 80% of the energy consumed in the country isfrom Renewable Energy Sources.
The Company has firmed up the path towards carbon
neutrality by 2050 by joining the elite list of Global
Multinational and becoming the first Company
in Kenya’s public sector to commit to business
ambition for the 1.5ºC campaign. On 8th June 2021,
KenGen received confirmation on admission to theBusiness Ambition for 1.5°C, thus joining the list ofvisionary leaders on the UN Global Compact website
and their partner websites at CDP- https://www.
cdp.net/en and We Mean business - https://www.
wemeanbusinesscoalition.org/“Building a future of Shared Prosperity “

49KenGen’s CLIMATE AMBITION
The Company is developing its Science Based Targets towards a 1.50C campaign. KenGen participated in the
Climate Ambition Accelerator program from June to December 2021, and two members of  Staff completed theprogram and were awarded certificates. The Company is currently undertaking pilot Carbon Footprint analysis
in two of its Business Areas, namely Geothermal Division and Central Office, covering Direct Emissions (Scope1) and Indirect Emissions (Scope 2 and 3). This analysis will go into the establishment of a Baseline for thedevelopment of the science-based targets by 2023.

KenGen’s Carbon Emission Reductions Portfolio
In line with the United Nations Framework Convention on Climate Change (UNFCCC), the Company  has developed
and registered six Clean Development Mechanism (CDM) projects which contribute to approximately 1.5 Million
tCO2e annually. To date, the verified projects have resulted in the issuance of 4,991,923 tCO2e Certified
Emissions Reductions (CERs).

CERS ISSUED TO DATE
2,025,813

2,500,000

2,040,515

2,000,000
1,500,000
1,000,000

655,123
170,469

500,000

KIAMBERE

76,13523,868TANA

OLKARIAII

OLKARIAIV

OLKARIA
IAU

NGONG
5.1MW

During the period 2020/2021, we obtained 4,617,309.00 tCO2e Certified Emissions Reductions (CERs) issued;

50

No

Project

Mode of Generation

Issued CERs (tCO2e)1.

KiambereHydro

160,160

2.

Tana

Hydro

57,4583.

Ngong 5.1MWWind

23,8684.

Olkaria II

Geothermal

309,495

5.

Olkaria I AU 4&5

Geothermal

2,040,515

6.

Olkaria IV

Geothermal

2,025,813  

KenGen Communication on Progress Report For Year 2021

KenGen Managing Director and other Panellists at the World Leaders Summit

Environmental Sustainability
Statement

In an emerging economy gravely affected by a ranging
pandemic, heavily regulated by stringent climatechange policies and conflict adherence programs,
KenGen weathered through its environmental
sustainability agenda which is anchored on
Environmental Social Governance (ESG) andinterrelated conflict resolution mechanisms.
The
environmental
sustainability
programs
encompass responsible interaction with the natural
resources in the business and avoid jeopardising theability of future generations to meet their needs.
Responsible environment management, biodiversity
conservation, projects monitoring and appraisal, andclimate change services are at the core of various
modes of sustainable energy generation.

Global Leadership
Changeinat the panel discussion focusing on power, roadtransport, hydrogen, and steel. She showcased theacceleration of Renewable Energy by KenGen in Kenya
and the Region through the services the Company
offers, including Geothermal Drilling and Consultancy.
This is in line with Kenya’s commitment to have 100%
Renewable Energy by 2030.
KenGen Managing Director and CEO also participatedin a panel discussion during the launch of the Carbon
Dated Report by the Standard Chartered Bank on 15th
July 2021 that looked at the risk and opportunities
for suppliers as multinational corporations transition
to Net-Zero.

ClimateKenGen participated in the World Leaders’ Summit at
the COP26 in Glasgow, United Kingdom, on November
2, 2021, with the focus being ‘Accelerating Clean
Technology Innovation and Deployment’.
The Managing Director and CEO delivered her speech“Building a future of Shared Prosperity “

51KenGen’s CLIMATE AMBITION

From left Executive Director, AFDB Eastern Africa, Cheptoo Amos Kipronoh, PS Environment, Dr. Chris Kiptoo, Energy CS, Dr. Monica Juma,
KenGen MD and CEO Rebecca Miano, KenGen Director, Mary Maalu, and other representatives of #TeamKenya at COP26.

KenGen MD and CEO participated in a panel discussion during the launch of the Carbon Dated Report by
the Standard Chartered Bank on 15th July 2021

52

KenGen Communication on Progress Report For Year 2021

Sustainable Environmental
Management
KenGen’s Environment Sustainability Policy, guides
the operations and activities to comply with applicable
environmental laws, regulations, standards, andrequirements that the Company subscribes to.
KenGen has continued to implement an Environmental
Management System that complies with International
Standards and has maintained ISO 14001
Certification from 2009 to date with regular external
certifications audits. In the year under review, KenGen
was recertified to both ISO 9001 and ISO 14001
Standards, demonstrating the commitment to runningof the business responsibly and sustainably.
During the year under review, the following
environment
management
activities
were
accomplished;
Environment Social Impact Assessment studies
conducted and Environment Impact Assessment
license issued for the following projects:• Proposed Energy Research & Development Centre
and Corporate Archive Building in Upper Tana
• Proposed Ngong Wind Farm Borehole Project• Renewal of EIA license for Seven-Forks PV Solar
Project (42.5MW).

Initial Environment audits were carried out for:• Olkaria Geothermal Wellheads (OW-37, OW-39,
OW-905 & OW-919)• Turkwel Power Station facilities (Incinerator,
wastewater treatment lagoon & asbestos bunker)
Statutory self-annual audits were similarly carriedout in 35 KenGen facilities and installations

Pollution Control and Waste
Management (Wastes Stream)
KenGen has put in place pollution control measuresand mitigated negative environmental impacts, whileat the same time enhancing positive environmental
impacts resulting from the activities, products, andservices.
The waste is managed and disposed of by firms
registered by the National Environment Management
Authority as required by waste management
regulations of 2006. A culture of waste segregation
has been inculcated through regular awarenesssessions, signages, and the provision of appropriate
waste bins.

WASTE GENERATED FROM ALL
OPERATION AREAS AS AT 3OTH JUNE 2021

FOOD WASTE(KGS)

12,299.65

LUBE OIL USED(LITRES)51,767OILY RAGS(KGS)

10,607
PAPER USED (KGS)

4,771.30“Building a future of Shared Prosperity “

53KenGen’s CLIMATE AMBITION
During the year under review, KenGen acquired
emission licenses for the incinerators and Thermal
Plants (Muhoroni Gas Turbines 1 & 2 and Kipevu I &III).  We also acquired effluent discharge licenses forapplicable facilities such as Turkwel lagoon, Muhoroni
oil-water interceptor, Kipevu I and III oil-waterinterceptors as provided in Kenya’s Water Quality
Regulations, 2006.
Stack emission monitoring and measurement
The Company carried out quarterly monitoring
and reporting of air quality emissions in 18 power
generation and affiliated facilities in fulfilment oflegal and regulatory requirements.

The 2 billion Trees Campaign
KenGen continues to support the Government of
Kenya’s commitment of planting 2 billion trees
campaign to accelerate the achievement of the
10% tree cover by 2022 of the land area of Kenya.
Towards this objective, KenGen has distributed tothe communities and institutions over 1.9 million
tree seedlings which are equivalent to 3,167 acresfor the last 7 years to enhance sustainability of theecosystem

Projects appraisals and Monitoring
The ongoing projects were appraised and monitored
during the period under review including:•   Preliminary Environmental and Social Impact
Assessment under feasibility for the Floating Solar
Photovoltaic (PV).
• Environmental and Social Impact Assessment
studies for upgrading of Gogo Power Station.
• The Marsabit wind project Environmental &Social
Impact Assessment.
• Scoping for the raising of Masinga Dam project.
• Waste to Energy Preliminary Environmental andSocial Impact Assessment.
• Environmental and Social Management Plan
(ESMP) for Olkaria IV and I AU 4 and 5 uprating.
• Seven Forks Solar PV Stakeholder consultation
and archaeological survey.

Biodiversity Conservation
Catchment Restoration

andKenGen recognizes the significance of ecologicalrestoration and enhancement in key catchment areasof Mt. Kenya, Mau Complex, and Eburru forest. In theyear under review a total of 181,031 trees wereplanted which have a net potential of absorbing
42,257 tons of CO2 annually.

54

KenGen Communication on Progress Report For Year 2021

Ngong hills catchment conservation projectPartnerships
Partnership in Celebrating World Environment Day
KenGen, during the year, partnered with three (3) other National Institutions in the commemoration of the World
Desertification and Drought Day held at Dr. Ribeiro Secondary School. The national event was held at Marsabit
County, Chalbi Desert, with the participation of three (3) KenGen staff. 110 seedlings were issued and planted
at Dr. Ribeiro Secondary School in celebration of the World Drought and Desertification Day and in the national
event for the commemoration of World Environment Day held on 5th June 2021 at Garissa University.
During the year, the Company also hosted the National Observance of World Habitat Day themed: “Accelerating
Urban Action for a Carbon-free World,” at Olkaria Geothermal Spa, where two Government Ministers graced theoccasion.

KenGen Managing Director and CEO welcoming the Government Ministers to Olkaria Spa for the Celebration of the

The celebration aimed to amplify the global Race to Zero Campaign and UN-Habitat’s Climate Action for Cities
and encourage local governments to develop actionable zero-carbon plans in the run-up to the International
Climate Change Summit COP26 in November 2021.

“Building a future of Shared Prosperity “

55KenGen’s CLIMATE AMBITION
Partnerships for enhanced conservation
KenGen is a key player in the implementation of the
Kenya Energy Sector Environment Program (KEEP)
project which is steered by the Ministry of Energy
This project is supporting the achievement of the
GoK Agenda on attaining the 10% forest cover by
2022 and conservation of water catchment areas
with a view of sustaining hydropower generation.
During the year under review, projects have been
initiated and are at different levels of implementation
including the following:• 100Ha of catchment rehabilitation in Aberdare
catchment,• Restoration of 20Km of riparian land along
Mathioya river in Muranga County,• Restoration of 107Ha at Londiani forest within
Mau complex,• Ngong hills soil conservation/land reclamation
project procurement for the rehabilitation works
underway. Rehabilitation to be affected in
2021/2022 Financial Year.
Further, KenGen has committed to contributing
2Million seedlings to National Environment TrustFund (NETFUND), 2Billion trees growing campaign
between 2021-2025.

Energy efficiency
The Company regards prudent energy efficiency as animportant component of business sustainability. The
Energy Efficiency program is focused on putting inplace measures that comprise energy-saving devices,rational saving methods, and using alternative energy
sources.
In this regard, KenGen has  developed and implemented
an energy policy and energy management program
to conform with Energy (Energy Management)
regulations in 2012 and reap the benefits of energy
management through cost savings.
In the last one-year KenGen conducted energy audits
in Kipevu I, Kipevu III, Masinga, and Gitaru power plants
and is implementing the following recommendations:

56

KenGen Communication on Progress Report For Year 2021

Efforts that have been put in place to manage energy
consumption in KenGen facilities include:• Implementation of solar Photovoltaic (PV) projectin Kipevu; Installation of solar street lights in
Kipevu, Kamburu, and Gitaru;• Replacing high energy-consuming lighting fixtureswith Light Emitting Diode (LED) lighting in all
KenGen facilities; and• Minimizing energy imports from the grid throughload management during curtailment.
The Company is implementing a revamped technicalassurance framework to support OPEX optimization
efficiency and improve maintenance practices.
This is done by carrying out root cause analysis on
recurrent Operation and Maintenance challenges
to reduce revenue leakages (root cause analysis for
Olkaria I Unit 4 & 5 currently ongoing) and execution
support during major maintenance works to optimize
the maintenance costs currently being done during
Masinga Unit 2 rehabilitation.
•  KenGen has so far realized total energy savings of
1,622,950kWh, amounting to CO2 reductions of535,574Kg. annually.
• Energy management teams in all the regions tooversee energy management programs• 40 employees have gone through the Certified
Energy Manager training.

2020 Commitments

Status in 2021

1. Enhance monitoring and evaluation of the environ- Annual Monitoring and Evaluation of the Environmenmental aspects and prepare a corporate report.
tal Aspects was done during the year and reported
during the Annual Environmental Self-Audits done
from October to December 2021.
2. Carry out all the statutory environment audits.

28 environmental audit reports were done and submitted to the National Environment Management
Authority. Environmental management plan being
implemented on the issues raised.

3. Register new green projects including three pro- The registration of the new projects was delayed due
jects under implementation i.e. Olkaria V, Olkaria I Ad- to the postponement of COP26 that was expected toditional Unit 6, Olkaria I rehabilitation.
determine continuity of Kyoto Protocol projects post2020 due to the COVID-19 pandemic. A decision on
Article 6 was finally agreed at COP26 in Glasgow, theUK including the transition of Kyoto Protocol projects
Article 6 projects in November 2021.
4. Continue to engage in initiatives aimed at piloting During the period, KenGen participated in a World
operationalization of Article 6 of the Paris Agreement Bank Pilot on the operationalization of Article 6 of thewhich is the successor to the Kyoto Protocol to take Paris Agreement.
advantage of the emerging opportunities in the Climate Finance arena.

“Building a future of Shared Prosperity “

57

KenGen’s CLIMATE AMBITION
2020 Commitments

Status in 2021

5. Continue with the engagement of National Stakeholders including the Climate Finance Unit of theGovernment of Kenya National Treasury, the Climate
Change Directorate, and Development Finance Institutions (DFI) to benefit from the emerging opportunities in the Climate Finance arena.

The Company participated in engagements organizedby the Climate Change Directorate in the year 2021
including participating in the COP26 meeting at Glasgow, UK in November 2021.

6. Seek other avenues to trade the company’s CERs KenGen is currently in the process of selling its issued
considering the changes in the global Climate Change carbon credits through an open international tender.
arena which includes the end of the Kyoto Commitment period and coming into force of the Paris Agreement.
7. Enhance resource sustainability by growing 181,000 tree seedlings issued.
150,000 tree seedlings within the KenGen operation
areas.
8. Implement a 10-year tree planting project for 100 schools in Makueni, Kitui, and Machakos enrolled
schools with a target of 1,000 schools by 2023.   
in the Schools Green initiative program, making a total of 700 schools that are participating.

KenGen’s Commitment in 2022
In the year 2022, KenGen have set out to do and commit to the following;
•
•
•
•
•
•
•
•
•

58

Enhancement of  Sustainability /Environmental Social Governance and Revenue Diversification.
Implement UNGC Program on Business 1.5˚C Commitment by 2023.
Carry out environmental and social audits in all the installation.
Support Conservation through enhanced partnership (Kenya Energy Sector Environment Program (KEEP),
NetFund, KenGen Foundation).
Provide 180,000 tree seedlings to catchment area communities within the operation areas.
Commemoration of three national environment conservation events.
Enhance Operational Efficiency and Safety.
Participate in at least three UNGC programs at national and Global levels.
Create awareness on at least 50% of KenGen’s employees on Sustainable Development Goals and the ten
principles of UNGC.

KenGen Communication on Progress Report For Year 2021

Kamburu Dam“Building a future of Shared Prosperity “

59KenGen’s ETHICAL PERSPECTIVEPRIORITY SDGs
16.5 Substantially reduce corruption and bribery in all their forms .
16.6 Develop effective, accountable, and transparent institutions at all levels .

KEY PRINCIPLES
Anti-corruption

Principle 7: Businesses should support a precautionary approach to environmental challenges;

MOST RELEVANT ISSUES
1.
2.
3.
4.
5.
6.
7.

60

KenGen’s Policies & Procedures
KenGen’s Integrity Structure
KenGen’s resilience towards honest businessGuiding our Stakeholders Behaviour
KenGen’s partners in enhancing ethics and integrity
KenGen kept the promise
2021/2022 commitments

Introduction

Policies and Procedures

Corruption erodes trust, weakens democracy,
hampers economic development, and further
exacerbates inequality, poverty, social division, andthe environmental crisis. The Government introduced
the Public Service Integrity Programme (PSIP) in 2003
to mainstream and institutionalising the preventionof corruption in all public institutions. Kenya hasenacted laws to facilitate corruption prevention andpromotion of sound ethical standards and practices insociety, which include; the Ethics and Anti-Corruption
Commission Act, Leadership and Integrity Act, Bribery
Act. And 2018, National Ethics & Anti-Corruption
policy.

KenGen is committed to conducting business withhonesty and accountability to the interest of all
the stakeholders. The Company, therefore, adopted
several strategies aimed at building a resistant culture
to corrupting and unethical behaviour. The Company
has demonstrated due care and diligence in the fightagainst corruption by developing policies that guide
employees, Board members and other stakeholders,
including vendors. The Anti-Corruption and Bribery
policy provides clear guidelines on prevention
measures within which our employees, management,
and other stakeholders operate. The policy defines
the corruption prevention operating framework.

Kenya Electricity Generating Company (KenGen) is
committed to promoting high standards of ethicalpractices in all its business processes and areas.
The company adopted the framework under the
PSIP program and has institutionalised strategies
to be implemented to ensure ethics and integrity
is mainstreamed in all its business functions andcorruption risks are kept at a minimum.

KenGen’s Gift and Entertainment Policy guides theemployees to make the right decisions when giving
or accepting gifts, courtesy, entertainment or travel
while conducting business on behalf of the Company.
In the year under review, 35 employees declared gifts
received.

KenGen Communication on Progress Report For Year 2021

The Company has provided various channelsof reporting actual or suspected wrong-doings
committed by employees, suppliers, service providers,
contractors, or other stakeholders dealing with theCompany. Anonymous reporting is also done throughthe hotline number https://www.KenGen.co.ke/index.
php/anonymous-report22.html.
The Company’s Whistleblowing Policy provides
assurance that any employee or stakeholder making
a report will be protected from reprisals, retaliation, or
any adverse treatment.
KenGen has developed a Conflict of Interest Policy togive measures to identify, manage and avoid existingand potential conflicts of interest within the businessenvironment and set out the roles and responsibilities
of relevant parties.
During the year ended, 50 employees declared aconflict of interest. The Employees’ Code of Conduct
and Ethics stipulates employees’ expected behaviour
both with the Company and in Public as per the Public
Officers Ethics Act.  Every new employee is expected
to sign the Code of Conduct and abide by it. All
employees have signed the Code of Conduct. While
suppliers are independent entities from the Company,
the business practices and actions of suppliers, when
conducting business with or on behalf of the Company,
may significantly impact reputation and relationshipof trust with the Company clients, employees, andother stakeholders.

The Suppliers’ Code of Conduct outlines guidelinesthat suppliers must abide by while doing businesswith us. To ensure that the recruitment process istransparent and that the Company attracts employees
who are qualified, KenGen carries out due diligence
for all recruits before joining the company. During theyear under review, 185 due diligence was carried out
in the recruitment process.

KenGen’s Integrity Structure(i)   Establishment of an Integrity Office
To promote ethics and integrity in the Company,
KenGen has established a fully-fledged integrity
office with the mandate of coordinating anticorruption activities. The office is headed by asenior officer who reports to the top management.
This ensures the top management is well versedwith integrity-related issues.
(ii) Corruption Prevention Committees: To monitor
implementation of integrity activities, KenGen
has an established and vibrant corporate
Corruption Prevention Committee (CPC), which
has undergone integrity training. This committee
was trained by the constitutionally mandated
government anticorruption oversight agency(Ethics & Anti-Corruption Commission) to empower
the committee with the latest skills in dealing withthe ever-emerging forms of integrity breaches.
The committee chaired by the Managing Director
and CEO meets regularly to monitor progress on
the implementation of integrity initiatives. As

Integrity Champions’ Training“Building a future of Shared Prosperity “

61KenGen’s ETHICAL PERSPECTIVE
part of ensuring that Integrity management isentrenched in all the business areas, KenGen
has established regional Corruption Prevention
Committees, which are chaired by the respective
Region Managers. In the year under review, 6
meetings were held by the corruption prevention
committees.
(iii) Integrity Champions: to champion ethics     andintegrity in all its business processes, some
employees are nominated as Integrity champions.
These are drawn from all the company’sbusiness areas. The officers are taken throughcomprehensive training by Ethics & AntiCorruption Commission (EACC). The champions aretasked with the role of spearheading ethics andintegrity within their functional areas. A total of
106 Integrity champions have been trained.

62

KenGen’s Resilience Towards
Honest Business(i) Corruption Risk Assessment and Mitigation
Plan: The Company developed a Corruption
risk diagnostic tool that seeks to identify
weaknesses within the system which may
present opportunities for corruption to occur.
The tool has enabled us to build a comprehensive
picture of the risks that KenGen faces, evaluate
controls, likelihood, and impact of these risks. The
Company conducted Corruption Risk Assessment
and developed Risk Mitigation Plan. Monitoring of
implementation of risk mitigation plans identified
was done continuously and quarterly reports
were prepared and submitted to Ethe this & AntiCorruption Commission.

Risk Identified

Mitigation Measures

Compromised quality of goods• Strict Inspection of goods
A corporate-wide awareness by• Signed off verification forms
Public Procurement Regulatory
and inspection and acceptance
Authority (PPRA) was carried out.
certificates.
• Create awareness of the inspection
and acceptance procedures under
the PPADA, 2015.

Declaring of usable assets for
disposal• Joint verification before disposal of • A procedure on identifying
any itemitems before declaration for• Clear criteria be developed
disposal has been developedand enforced on procedures ofidentifying items before declaration
for disposal

Skewed floating of quotations• Rotation of pre-qualified suppliers.   Rotation of pre-qualified suppliers(except for Persons Living With
Disability) is done after every twomonthsFixed assets misappropriations• Impromptu  physical counts andverification• Asset tagging• Integration of System Application
and Products (SAP) and Bar code
scanner

KenGen Communication on Progress Report For Year 2021

Measures Undertaken(implemented)

All assets have been barcodedGuiding the Stakeholders Behaviour
The Company has been engaging with employees to communicate the expectations on matters relating to
ethics and integrity while doing business. During the period under review, 180 suppliers were trained.

Awareness Creation Session.

As a way of communicating the commitment to ethicalbusiness, KenGen has made it a practise to include
a clause about the commitment and the contact forreporting unethical behaviour in all the advertised
tenders, either online or through local dailies.
As part of rallying employees to embrace the global
call in the fight against corruption, the Company has
joined the world every year on 9th December tocommemorate the International Anti-corruption Day.
During the year under review, 635 members of staff
attended the event.

The Company conducts awareness creation session
to enhance behaviour. Through an online weekly
newsletter, we encourage our employees to commit
to good behaviour by writing articles in the KenGen
Weekly. Under the period reviewed, 15 articles
touching on integrity were published. KenGen also
evaluates employees’ knowledge on integrity mattersby administering quizzes and awarding those who
excel. During the period under review, 521 membersof staff participated in the integrity questionnare.

“Building a future of Shared Prosperity “

63KenGen’s ETHICAL PERSPECTIVE
As guided by the Public Officers Ethics Act, all theemployees declare their wealth every two years. The
declaration is part of the accountability mechanismsthat ensure that employees working in the public
sector do not accumulate illegal wealth.
The Company has continued to implement the national
values and principles of governance as enshrined in
Article 10 of the Constitution of Kenya.
KenGen submitted the Annual Report whichindicated the progress and measures taken towards
mainstreaming of the values the Company and has
continued to implement values and principles of public
service as enshrined in Article 232 of the Constitutionof Kenya. A progress report was submitted to the
Public Service Commission.

Enforcing stakeholders behaviour
As part of processing the incidences received on
integrity breaches, the Company has establishedinvestigations, where incidences reported areinvestigated and disciplinary action taken dependingon the severity of the breach. During the period under01
Ethics &Anti-Corruption
Commission
Training

64

02

National Police
Service
Investigations

KenGen Communication on Progress Report For Year 2021

03

review, 23 incidences were investigated and action
taken. Disciplinary action: As part of enforcing theCode of Conduct, disciplinary action is taken against
the employees whose cases have been investigatedand recommended for disciplinary action. During theperiod under review, 20 employees were put throughthe disciplinary process.

Partners in enhancing ethics andintegrity
KenGen understands the importance of partneringwith other government agencies in enhancing theimplementation of initiatives aimed at promoting
ethics and integrity within the Company. The partners
assist in awareness creation and the law enforcement
agencies assist the Company when conducting
investigations where members of the public are
involved.

04

Director of
Criminal
Investigations

05
Procurement
Regulatory
Authority Training

NationalIntelligence Service
Due DiligenceObjective Indicator

Activities/process

OutputImplementation of Vendors Code of Conduct

Approval of the code of
conduct

Code of conduct approved This is pending the board’
approval

Dissemination and
Administering of code of
conduct to suppliers

70% of suppliers reached

Dissemination has been
done in Eastern Region,
Western Region. 40 % ofsuppliers reached. The
pending areas are theCentral office, Kipevu,
and Turkwel

Integrity Risks
Management

Review of the Corruption
Risk Assessment and
Mitigation Plan

Reviewed Corruption risk
assessment & Mitigation
plan

The risk assessment wasreviewed and continuous
monitoring of the risks

Staff awarenessprograms

12 integrity-related
articles on KenGen
weekly80% of staff reached

15 integrity-related articles on KenGen weekly
were published

One (1) virtual
sensitization meeting

70 % of staff reached

11 awareness sessions
were held. 1864 employees were reached

Purchase the standard
manualISO 37000:2016(E)The training on the ISO
Anti-bribery Management standards is still ongoing
system manual purchased

Review KenGen antibribery practices &Policies

Best Practices developed

Implement ISO
37000:2016(E) Antibribery Management
systemStatus

The review of theAnti-Bribery Policy ispending approval of amodel procedure from the
Ethics & Anti-corruption
commission

KenGen’s commitments in 2022
In the year 2022, the Company has set out to do and commit to the following;
1. Enhanced monitoring of corruption risks within the Company.
2. Continue engaging stakeholders more sore suppliers into doing clean business with KenGen.
3. Implement targeted awareness sessions on employees working in high-risk functions.
4. Conducting an annual integrity week.
5. Implement ISO 37000:2016(E) Anti-bribery Management system.
6. Working with Ethics and Anti-Corruption Commission (EACC) in developing anti-bribery policy.

“Building a future of Shared Prosperity “

65Kamburu Power Station

66

KenGen Communication on Progress Report For Year 2021

SUSTAINABILITY IN KenGen’s SUPPLY CHAIN
PRIORITY SDGs
4. a
Undertake reforms to give women equal rights to economic resources, as well as access toownership and control over land and other forms of property, financial services, inheritance,and natural resources, by national laws.
5. b
Enhance the use of enabling technology, in particular information and communications
technology, to promote the empowerment of women.
8.5
By 2030, achieve full and productive employment and decent work for all women and men,
including for young people and persons with disabilities, and equal pay for work of equalvalue.

12. a
Support positive economic, social, and environmental links between urban, peri-urban, andrural areas by strengthening national and regional development planning.

12.2
By 2030, achieve the sustainable management and efficient use of natural resources.
12.5
By 2030, substantially reduce waste generation through prevention, reduction, recycling,
and reuse.
12.7
Promote public procurement practices that are sustainable, by national policies and priorities.
17.16
Enhance the global partnership for sustainable development, complemented bymulti-stakeholder partnerships that mobilize and share knowledge, expertise, technology,
and financial resources, to support the achievement of the sustainable development goals
in all countries, in particular developing countries.

KEY PRINCIPLES
Anti-corruption

Principle 10: Businesses should work against corruption in all its forms, including extortionand bribery.

Environment

Principle 7: Businesses should support a precautionary approach to environmental challenges;
Principle 8: undertake initiatives to promote greater environmental responsibility; andPrinciple 9: Businesses should encourage the development and diffusion of environmentally friendly technologies.

MOST RELEVANT ISSUES
·
·
·
·
·
·
·
·

Legal Compliance
Procurement during the COVID-19 Environment
Embracing Technology in Procurement
Opportunities and Diversity in the procurement
Buy Kenya Build Kenya
Value Creation for Sustainability
Stakeholder management
KenGen’s 2022 Commitments.

“Building a future of Shared Prosperity “

67SUSTAINABILITY IN KenGen’s SUPPLY CHAIN
Introduction
One of the key objectives as a responsible business isto help build supply chains that are more sustainable
and inclusive. KenGen achieved this by encouraging
a mindset of responsible buying both inside andoutside Kenya, hence helping to generate a mutually
beneficial relationship with the stakeholders. Supplier
inclusion, diversity, and sustainability are at the coreof the procurement strategy. The Company takes pridein operating a responsible business, where everyone
benefits through buying for long-term value,  which isone of the many ways KenGen is delivering change,
both on a national and global scale.

Legal Compliance
The Public Procurement and Asset Disposal
Regulations 2020 have been incorporated and

68

KenGen Communication on Progress Report For Year 2021

operationalized in the supply chain processes toensure compliance. KenGen update and publicize
complete information on all tenders and procurement
contracts awarded as required by Executive Order
No.2 of 2018. This is done to deepen accountability
and transparency in the procurement process

Procurement During the COVID-19
PeriodThe global supply chain has been adversely disrupted
due to the pandemic. However, through insights andstrategic partnering, the Supply Chain team worked
through solutions to keep operations alive. Detailed
planning and meticulous execution under frameworkcontracting ensured seamless provision of critical andstrategic spares to avail our generation fleet.

Elaborate initiatives were employed to improve
inventory efficiency and accelerate responseto changing demand. Comprehensive contract
management guaranteed protection of our money
value while building stronger and healthier
relationships with the suppliers.
The Company has embraced long-term contracts andengagements with Original Equipment Manufacturers(OEM), ensuring that spares are available to improve
plant availability and reliability and ensure steadypower generation from the plant installations, forexample, the one between KenGen and Manitoba
Hydro.

Embracing
Procurement

Technology

inDuring the year, our e-Procurement system waseffectively deployed and through this, most of thetendering processes were conducted on this platform
with a target of 100% transition. KenGen has adopted
e-Procurement to increase efficiency, reduction ofwaste, and shorten procurement turnaround timethrough the Supplier Relationship Management
system. By doing so, the Company has increased
visibility and transparency of the procurement
processes; improved reporting and is a step ahead in
the paperless pandemic protocols.

Opportunities and Diversity in our
Procurement
In the endeavour to promote inclusivity and empower
the marginalized/disadvantaged groups, the Company
awarded Youth, Women, and Persons With Disability
procurement opportunities worth KShs.1.1 billion
against a target of KShs.2.7 billion. The absorption
was affected by the COVID-19 pandemic as supply
chain processes were greatly affected.
KenGen also adopted priority procurement topreserve cash flows and only engage in strategic
critical procurement. These measures brought cost
optimization to the Company impacting negatively
on the available opportunities for special groups andthereby drastically lowered the absorption rate.

“Building a future of Shared Prosperity “

69SUSTAINABILITY IN KenGen’s SUPPLY CHAIN
Buy Kenya Build Kenya
Local content in procurement was promoted through embracing the Buy Kenya Build Kenya initiative. The
total procurement opportunities awarded to local contractors were worth KShs.23.7 billion against a target ofKShs.18.8 billion.

BUY BUILD KENYA ABSORPTION

2019/2020

2020/2021

Allocation (Kshs)

Allocation (Kshs)

14,275,946,000

18,842,264,000Awarded (Kshs)

Awarded (Kshs)

12,919,690,000

23,732,390,000

Value Creation for Sustainability
The Company embarked on procuring goods, works,
and services at competitive prices, within theavailable budget, and strictly within the prevailingmarket rates indices. This is done through a rigorousbaseline setting informed by surveys of market rates
to guide the procurement process.

Stakeholder management
KenGen strives to continuously engage and build
collaborative relationships with key stakeholders
by conducting sensitization forums on procurement
opportunities within KenGen and the requirements

70

KenGen Communication on Progress Report For Year 2021

needed for them to participate in doing business with
the Company. A total of 226 members participated inthese sessions across the company.

KenGen’s Commitments in 2022
In 2022, the Company has set out to do and commit
to the following;• Enhance the business value for special groups.
• Embrace  technology to improve  the efficiency of  the procurement processes.
• Enhance the engagement with businessstakeholders.

Turkwel Dam“Building a future of Shared Prosperity “71AWARDS AND RECOGNITION

The Annual Trailblazers
Award for Gender
Mainstreaming
category winner inTrailblazers Award by
the Ministry of PublicService and Genderthrough the Pink
Energy initiative

FiRe Award-IFRS category Winner of State Corporation andSemi-Autonomous Government Agencies
FiRe Award Category Winner in Environmental and Social
Reporting or Corporate Social Responsibility category

Best Public Procurement
Project of the Year by the
Kenya Institute of Supplies
Management

72

KenGen Communication on Progress Report For Year 2021

Winner in Public Sector Law
Department of the Year by
The Law Society of Kenya,
Nairobi Branch

FINANCIAL HIGHLIGHTSPERFORMANCE HIGHLIGHTS FOR THE FINANCIAL YEAR ENDED 30 JUNE 2021

INSTALLED CAPACITY [MW]UNITS SOLD [GWH]

CAGR 2.8%

CAGR 2.8%

2021

1,818

2021

2020

1,818

2020

2019

1,631

2019

2018

1,631

2018

2017

1,631

2017

8,443
8,237
8,277
7,989
7,556

ASSETS [Kshs Millions]

TOTAL REVENUE [Kshs Millions]

CAGR 3.1%

CAGR 1.4%

2021

425,6582020

412,927

2019
2018
2017

401,422379,353
376,730

44,1102019

45,96645,29043,432OPERATING EXPENSES [Kshs Millions]
CAGR -1.8%

2021

35,011

2020

2017

2020

2017

CAGR 4.8%

2018

45,901

2018

ELECTRICITY REVENUE [Kshs Millions]

2019

2021

33,78329,79728,28629,0072021

20,0652020

18,334201924,1192018

22,9252017

21,538“Building a future of Shared Prosperity “73FINANCIAL HIGHLIGHTS

EBITDA [Kshs Millions]

PROFIT BEFORE TAX [Kshs Millions]

CAGR 3.7%

CAGR 6.5%2021

26,3312021

2020

26,2492020

13,7902019

11,65420192018

25,6452018

21,5902017

CAGR -39.7%

2021

14,8102020

2017

11,461PROFIT AFTER TAX [Kshs Millions]

CAGR 2.9%

2018

11,7452017

22,790OPERATING PROFIT [Kshs Millions]2019

14,762

14,2202021

12,492
13,202

18,37720202019

12,105

1,188

2018
2017

7,884
7,891
9,006

*CAGR - Compound Annual Growth Rate

74

KenGen Communication on Progress Report For Year 2021

NOTES“Building a future of Shared Prosperity “

75NOTESNOTES“Building a future of Shared Prosperity “

77Kenya Electricity Generating Company PLC
KenGen Pension Plaza 2, Kolobot Road, Parklands
PO Box 47936 - 00100 GPO, Nairobi, kenya
www.kengen.co.ke@KenGenKenya

KenGenKenya@KenGenKenya

78

KenGen Communication on Progress Report For Year 2021

KenGenKenya

KenGenKenya