"Steam, Scandals, and Stalled Megawatts: KenGen’s Court Battle Over Olkaria VII Consultancy"

Power, Politics, and Procurement: Inside KenGen’s Legal Battle Over Olkaria VII Geothermal Consultancy

In a dramatic twist that’s shaken Kenya’s energy sector, the Kenya Electricity Generating Company (KenGen) is locked in a legal showdown over the consultancy tender for its highly anticipated Olkaria VII geothermal power plant. The project, aimed at injecting 80 megawatts of clean energy into the national grid, now faces turbulence—not from the underground steam chambers of Hell’s Gate, but from boardrooms and courtrooms.

🔍 What’s the Fuss About?

At the heart of this high-stakes battle is a €18.16 million consultancy tender awarded to Italy’s ELC Electroconsult SPA. The catch? Their bid was over Sh200 million higher than that of the next technically qualified firm. The Public Procurement Administrative Review Board (PPARB), Kenya’s watchdog for public tenders, wasn’t impressed.

In a June 2025 ruling, PPARB annulled the award, citing procedural irregularities, including the introduction of undisclosed sub-criteria and deviation from the lowest-compliant-bidder principle. It ordered KenGen to re-evaluate all bids afresh—a ruling that sent shockwaves across the sector.

But KenGen is not backing down.

⚖️ A Legal Showdown Unfolds

Instead of re-opening the tender, KenGen has taken the fight to court, accusing the procurement tribunal of overstepping its mandate and effectively “pre-selecting a winner.” According to court filings, KenGen argues that the tribunal’s ruling has tied their hands and reduced them to mere rubber-stampers of a process they believe was fair from the start.

This legal move has thrown the fate of the Olkaria VII consultancy into limbo—and possibly delayed a project that was scheduled to deliver its first turbine by mid-2026.

🌋 Why Olkaria VII Matters

The Olkaria geothermal fields are Kenya’s renewable energy crown jewel. With current national geothermal capacity hovering around 863 MW, Olkaria VII is key to reaching the government’s 5,000 MW target by 2030. Set to cost around KSh 32 billion (US$247 million), the plant is critical for diversifying Kenya’s energy mix and ensuring long-term grid stability.

Any delays—especially at the consultancy stage—could cascade into prolonged timelines, ballooning costs, and erosion of donor confidence, particularly from institutions like the European Investment Bank.

🧮 The Numbers Behind the Noise

Winning Bid: €18.16 million

Runner-Up: €1.37 million cheaper

Amount in Question: ~Sh200 million

Project Capacity: 80 MW

Estimated Project Cost: US$247 million

What appears to be a technical procurement matter is rapidly evolving into a broader debate about transparency, accountability, and efficiency in managing public infrastructure projects.

🏛️ Governance in the Spotlight

The tribunal’s findings also raise questions about internal controls at KenGen. How did undisclosed criteria enter the evaluation matrix? Why was a significantly more expensive bid favored despite compliance from a lower-priced contender? And who will ultimately be held accountable if this process derails one of Kenya’s flagship energy projects?

One key figure under scrutiny is Vincent Mamboleo, KenGen’s Acting General Manager for Supply Chain. Reports allege that his office sanctioned the controversial award—a move that’s drawn sharp criticism from both within and outside the energy sector.

🔮 What’s Next?

The courts now hold the future of Olkaria VII in their hands. Will KenGen be allowed to stick with its original pick, or will the tribunal’s order for a re-evaluation be upheld? Either way, the implications are massive—not just for Olkaria VII, but for how procurement is managed across Kenya’s parastatals.

This battle isn’t just about megawatts and millions—it’s about the integrity of Kenya’s energy transition.

💬 Final Word

KenGen’s fight over the Olkaria VII consultancy contract underscores a core truth in infrastructure development: clean energy projects must be built on transparent foundations. As Kenya continues its push for sustainable energy leadership in Africa, the court's decision will serve as a litmus test for governance in public-sector investments.

Stay tuned. The steam from Olkaria isn’t the only thing heating up.

Source: Reserched and Written by Alphaxioms Legal Arm

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