KenGen seeks geothermal plants partner

Nairobi; Kenya: The State-controlled Kenya Electricity Generating Company (KenGen) wants to team up with private investors for the first time to build geothermal power plants that would come on stream by 2016.

Plan by the firm is part of the country's ambition to add 5,000 megawatts (MW) of capacity by 2017, against a current total of 1,664 MW, as it tries to tackle power shortages and high prices holding back business.

By 2030 Kenya estimates it will need some 15,000 MW of extra capacity, with much coming from geothermal and other renewables which will be both cheaper than widely-used diesel generators and more reliable than its hydropower dams which are affected by regular droughts.

KenGen Chief Executive Albert Mugo said the company had already drilled 45 out of a targeted 80 geothermal wells that were expected to produce an extra 400 MW by 2016 at a cost of about $1.7 billion.

The company, which is 70 percent state-owned and is Kenya's biggest power generator, was in talks with development institutions to borrow money for an initial plant with capacity of 140 MW, Mugo said in an interview. "We are also looking at being able to do joint ventures," he said, adding private partners "can help us in mobilising the debt for the project and also inject a substantial amount of equity and then we do these projects together".