- Kenya Electricity Generating Company PLC (KenGen) has reported a 35% surge in profit after tax for the fiscal year ending June 30, 2024, climbing to Ksh.6.8 billion up from Ksh.5 billion, driven by a strong growth in revenues from its geothermal and hydroelectric power plants.
At the same time, the NSE-listed generator’s finance income skyrocketed by 149% to Ksh.4.2 billion shillings in 2024, nearly tripling the 1.7 billion shillings recorded in 2023. This sharp increase bolstered the company’s overall profit jump underscoring its strategic financial management amid a volatile economic landscape.
“This impressive growth not only strengthens our financial position but also signals greater returns for shareholders now and long into the future, while enhancing our ability to invest in critical renewable energy projects providing more affordable, reliable electricity for our consumers,” said Eng. Peter Njenga, KenGen’s Managing Director and CEO.
This year’s financial results underscore KenGen’s ability to adapt to environmental and market challenges. The company reported dispatching 8,384GWh (Gigawatt- hours) of electricity during the year, up from 8,027GWh in 2023. The increase came despite volatile weather conditions and inflationary pressures that have affected many businesses in Kenya.
Eng. Njenga said the company was able to maintain a stable operating profit of Ksh.9.6 billion by focusing on cost management and efficiency improvements. KenGen’s power plants, particularly its geothermal and hydroelectric facilities, were critical to meeting the country’s peak electricity demand of 2,149MW during the period under review.
“Despite the harsh global macroeconomic challenges, characterized by high inflation and foreign exchange fluctuations, we were able to instill financial discipline and prudent cost management measures in our operations which has seen us flatten the operational costs,” said Eng. Njenga.
The CEO went on to state: “We are beginning to see the results of hard decisions taken on austerity measures implemented in the year and prudent financial management further supported by our ability to generate value from financial investments.”
According to the new financial results, KenGen’s revenues rose to Ksh.56.3 billion, a gain of Ksh.2.3 billion from the previous year. The company’s power generation output grew by 4% despite the decommissioning of over 130MW of fossil fuel- powered plants in Kipevu and Muhoroni in the year.
“The shift to green energy is part of our broader push to meet the rising energy demand while reducing our carbon footprint, aligning with the Government of Kenya’s ambitious renewable energy goals of transitioning to 100% green energy by the year 2030,” said Eng. Njenga.
The CEO went on to state that the company’s performance reflects its strategic focus on scaling up renewable energy capacity while maintaining operational efficiency. “We are committed to leading Kenya’s energy transition and delivering sustainable value to our stakeholders,” Njenga said.
Kenya has long been regarded as a leader in renewable energy on the African continent, with up to 90% of its electricity generated from renewable sources. KenGen, which produces about 70% of the electricity consumed in Kenya, has played a critical role in this transition, particularly through its geothermal projects.
Looking ahead, KenGen says it plans to focus on revenue diversification through projects such as the establishment of a Green Energy Park at Olkaria, which will provide industries with a platform to operate sustainably. The company is also providing commercial drilling services for geothermal development across the region, a move that is expected to further bolster its financial performance.
KenGen’s outlook for the future is firmly anchored in its Good-2-Great (G2G) 2024– 2034 Corporate Strategy, which is designed to propel the company into its next phase of growth. The strategy focuses on increasing renewable energy capacity by about 1,500MW, enhancing operational efficiency, and leveraging cutting-edge technologies to stay ahead in a rapidly evolving energy sector. KenGen is confident that this plan will not only ensure continued success but also support Kenya’s broader socio-economic development goals, particularly through improved energy access and environmental sustainability.
“We have several major renewable energy projects in our pipeline, the 42.5MW Seven Forks solar plant, rehabilitation of Olkaria I geothermal power plant to give us 63MW and redevelopment of Gogo hydropower station targeting a total of 8.6MW,” said Eng. Njenga adding that KenGen was committed to implementing its green projects on time and withing budget.
Eng. Njenga went on to say: “Our strategy goes beyond generating profits. At KenGen, we are deeply committed to environmental stewardship and responsible growth,” said Eng. Njenga. “The expansion of our renewable energy portfolio is aligned with our mission to support Kenya’s climate goals and drive sustainable development. As we continue to invest in green technologies, we aim to contribute meaningfully to the global fight against climate change.”
KenGen’s outlook, bolstered by its financial success and strategic focus on renewable energy, suggests that the company will continue to play a premier role in shaping Africa’s energy future.
“As we move forward, KenGen’s leadership in renewable energy and our ongoing commitment to innovation and sustainability will remain at the core of everything we do. We are not just providing energy; we are helping to shape a greener, more sustainable future for Kenya and the region,” said Eng. Njenga.
Author: Bryan Groenendaal
