× Business BUSINESS MOTORING SHIPPING & LOGISTICS DR PESA FINANCIAL STANDARD Digital News Videos Health & Science Lifestyle Opinion Education Columnists Moi Cabinets Arts & Culture Fact Check Podcasts E-Paper Lifestyle & Entertainment Nairobian Entertainment Eve Woman Travelog TV Stations KTN Home KTN News BTV KTN Farmers TV Radio Stations Radio Maisha Spice FM Vybez Radio Enterprise VAS E-Learning Digger Classified Jobs Games Crosswords Sudoku The Standard Group Corporate Contact Us Rate Card Vacancies DCX O.M Portal Corporate Email RMS
×

Olkaria V ground-breaking expected in August

BUSINESS
By Graham Kajilwa | April 1st 2016

The procurement phase of the Sh40 billion Olakaria V geothermal power plant project is complete. Japan Deputy Ambassador Mikio Mori confirmed this, saying construction of the 140 megawatt plant will begin this year as scheduled.

Scientist Cyrus Karingithi explains how turbines work at the Olkaria control room in Naivasha. [PHOTO: DAVID GICHURU/STANDARD]

“Bids have been sent to three applicants who were successful in the request for proposal stage. We expect construction works on the power plant to start in five months,” said Mori. He, however, did not disclose the three applicants. Three 14-megawatt wells have been sunk for testing before the winning bidder is given the go-ahead for construction. A well has a lifespan of 25 years and costs Sh700 million to drill.

“Just like Japan, Kenya’s dependence on hydro-power is not reliable due to climate change, which calls for the two countries to explore geothermal as the most dependable source,” noted the Ambassador. Japan is said to have the third richest reserves of geothermal power globally. It currently produces over 270,000MW.

Kenya hopes to attain 33,000mw by 2030 from its 23 sites with a geothermal power potential of 10,000MW located along the Great Rift Valley. “We expect the actual ground-breaking for the Olkaria V to be done before the upcoming Tokyo International Conference on African Development (Ticad vi) later in August, which will also give Kenya a chance to put forward its needs and aspirations in the energy sector for possible financing,” said Mori.

On March 9, Japan International Corporation Agency (Jica) had signed a Sh40 billion agreement with Treasury for Olkaria V. The agreement stipulates a 10 year grace period and a 30-year repayment period at an interest rate of 0.2 per cent. “We decided to sign the agreement with the Treasury to avoid bottlenecks associated with Parliament approvals that would have delayed the project as witnessed in Olkaria I-IV,” said Jica’s consultant Evanson Njenga.

Njenga said Kenya Electricity Generating Company (Kengen) and the National Treasury are still expected to sign a sub-agreement later to actualise the construction process. Meanwhile, European Investment Bank has pledged Sh12 billion to add to Jica’s Sh8 billion for the construction of the 70MW Olkaria one unit six. There are also plans to have Jica construct Olkaria VI, which will be fully owned by private power producers.

Share this story
A third of petroleum companies operating in Kenya could avoid tax
More than a third of companies that own petroleum rights in Kenya hold them through tax haven subsidiaries, a new report shows.
Dog walking becomes the newest hustle in town
Dog walking is now a status symbol. Owning a pet is cool. I nowadays meet lots of Kenyans and foreigners walking their dogs and some running.
.
RECOMMENDED NEWS
Feedback