Kenya Power tender hit by irregularities

Kenya Power has been forced back to the drawing board after a public procurement watchdog nullified a Sh1.86 billion tender for the provision of private security services across the utility’s operations.

The tender, advertised on February 27, 2026, sought to recruit 2,810 private security guards under two categories, Class A and Class B. It attracted 70 bids from security companies seeking to secure a share of the lucrative two-year contract.

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The dispute eventually reached the Public Procurement Administrative Review Board (PPARB), which uncovered several inconsistencies in the tender documents and evaluation process. The Board subsequently cancelled the entire procurement and directed Kenya Power to start the process afresh.

“This inconsistency was inherent in the Tender Document itself,” the Board said, referring to conflicting requirements that placed bidders in an impossible position during the allocation of security zones.

The controversy centred on the tender’s conditions, which required each security zone to be awarded in full to a single bidder while simultaneously limiting every successful company to a maximum of 200 guards. The contradiction became particularly significant in Stima Zone, which required 245 guards.

Kenya Power Tender Exposes Contradictory Award Rules

The Board found that Kenya Power’s tender requirements could not practically be implemented without violating at least one of the conditions.

If the utility followed the 200-guard ceiling, Stima Zone would have to be divided among different companies. However, splitting the zone would breach another requirement that every security zone be awarded in full to one contractor.

The contradiction was reflected in the final recommendations. Ismax Security Ltd was proposed for 206 guards, exceeding the stated ceiling, while other zones were also divided among multiple companies.

Western Region, for instance, was shared between Sumich Solutions Ltd and Lavington Security Ltd, while Nairobi Region was split between Ismax and Spyeagle Security Services Ltd.

The PPARB ruled that such arrangements demonstrated deeper problems with the way the tender had been designed and evaluated. It said the conflicting provisions created uncertainty for bidders and evaluators alike.

For Class A, Ismax Security Ltd, Lavington Security Ltd, Spyeagle Security Services Ltd and Sumich Solutions Ltd were proposed as successful bidders for a combined 715 guards at a total cost of Sh677 million.

Ismax was allocated 206 guards, Lavington 200, Spyeagle 200 and Sumich 109. Class B covered 2,095 guards through 15 companies at a combined cost of Sh1.18 billion.

The procurement dispute was brought before the Board by Riley Falcon Security Ltd after the company’s bid was rejected during the financial evaluation stage.

Riley Falcon argued that Kenya Power had unfairly rejected its bid on the basis that its prices were “not competitive”. The company maintained that the phrase had not been disclosed as an evaluation criterion and was not accompanied by a specific benchmark.

Kenya Power, however, defended its decision, arguing that Riley Falcon had passed both the preliminary and technical evaluation stages but failed during financial evaluation because its prices were higher than those submitted by successful bidders.

The utility maintained that the tender was based on the Lowest Evaluated Cost Selection method and that recommending a bidder with a higher price would not have been lawful.

Internal Warning Raised Before Tender Was Awarded

The procurement process had already triggered concerns within Kenya Power before the award notifications were issued.

The company’s General Manager for Supply Chain and Logistics recommended on June 9 that the procurement be terminated after identifying what he described as “material governance concerns”.

His review reportedly questioned how the tender requirements had been applied during evaluation and whether the procurement process had been conducted in accordance with the applicable rules.

Despite the warning, Kenya Power’s Accounting Officer rejected the recommendation two days later, on June 11.

The Accounting Officer approved the Evaluation Committee’s proposed awards and directed that the concerns raised during the review be captured as “lessons learnt” for future tenders.

The decision paved the way for the award notifications issued on June 12, which were later challenged by Riley Falcon.

The Board also examined how Kenya Power arrived at the final price recommended for Ismax Security Ltd. It found that Ismax’s original Nairobi bid was Sh9 million, inclusive of VAT, but the Evaluation Report subsequently recommended a figure of Sh7.5 million.

According to the Board, the evaluation documents did not adequately explain how the lower amount had been arrived at, raising another concern over the integrity and transparency of the evaluation process.

Riley Falcon also raised a conflict-of-interest allegation involving Sumich Solutions Ltd majority shareholder and director Jackline Lanoi.

The company presented records indicating that Saruni held 800 of Sumich’s 1,000 shares, equivalent to an 80 per cent stake. Riley Falcon alleged that she was a serving Chief Inspector in the National Police Service and therefore raised a potential conflict under public procurement law.

The Board, however, rejected the allegation because Riley Falcon failed to provide documentary evidence proving that the individual was a serving public officer.

“A finding of breach of Section 59 of the Public Procurement and Asset Disposal Act cannot be founded on conjecture or unverified allegations,” the Board said.

Despite rejecting that particular allegation, the Board identified wider failures in the procurement process.

It found that the preliminary evaluation, financial evaluation and due diligence exercises had not complied with several provisions of procurement law. The watchdog was particularly critical of the fact that due diligence had been used in a manner that affected bidders at the preliminary stage.

The Board concluded that the problems were not minor errors that could simply be corrected through another evaluation. Instead, it determined that the defects were embedded in the tender document itself.

“The defect originates from the Tender Document itself and is therefore incapable of being remedied through a re-evaluation,” the Board said.

The ruling nullified the June 12 award notifications and cancelled the entire Sh1.86 billion procurement.

Kenya Power has consequently been directed to restart the process after reviewing and correcting the tender document.

The decision means the utility must address the contradictory requirements before inviting fresh bids, particularly the conflict between awarding zones in full and imposing a 200-guard limit on individual contractors.

The case also highlights the importance of clear procurement rules in major public contracts, where ambiguities can expose institutions to costly disputes and delays.