CS Charles Keter puts power producers on 30-day notice

The Government has given three agents 30 days to start producing electricity from steam wells or have their contracts terminated.

Energy and Petroleum Cabinet Secretary Charles Keter said there is enough steam at the Menengai Crater to add some 105 megawatts (MW) of electricity to the national grid.

He said the continued delay by the three independent power producers (IPPs) was hurting the Geothermal Development Company’s (GDC) operations.

There has been controversy over the quantity of steam available at the site and its sustainability, with the IPPs claiming it is not enough for power generation.

Mr Keter said GDC has already consumed a whopping Sh40 billion of taxpayers’ money to drill 35 steam wells at Menengai Crater.

The CS spoke at the Menengai drilling site where he launched a catering programme aimed at cutting the cost of running the geothermal programme.

SET UP PLANTS

He said the new wells have the capacity to produce 137MW and that more wells will be sunk.

Mr Keter said the GDC had already fulfilled all conditions in the contractual agreements with the IPPs and wondered why they were taking too long to start power generation.

The producers, who include Quantum East Africa and OrPower 22, were supposed to set up their power plants by December last year.

The investors, who were selected through competitive bidding in 2013, are mandated to build and operate three geothermal plants in Menengai, each generating 35MW.

Construction was supposed to have started in October 2013 and be completed by the end of last year.

The companies plan to invest $210 million (Sh25.5 billion) in the construction of the power plants.

The project was expected to give 500,000 households and 300,000 businesses access to low-cost power under the Government’s 5,000MW initiative.

Kenya Electricity Transmission Company Ltd (Ketraco) has already set up a 132kV substation that will generate 105 MW of power from the wells for the national grid.