AfDB to fund more geothermal projects in Kenya

By Antony Gitonga | Friday, Apr 13th 2018 at 23:49
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African Development Bank

African Development Bank (AfDB) will continue financing the Geothermal Development Company (GDC’s) quest towards affordable clean energy, the bank’s Executive Director for Eastern Africa Region Dr Calleb Nyamajeje has said. 

Dr Nyamajeje, who is in the country to review the Menengai Geothermal Project, congratulated GDC for its efforts towards renewable energy and on cutting the cost of electricity. He lauded GDC for coming up with a model that ropes in Independent Power Producers (IPPs) towards geothermal development in the country. 

“I am happy that IPPs are now ready to put up power plants. That is a major milestone for GDC and AfDB,” he said at the Menengai Geothermal Project in Nakuru County.  GDC is drilling for steam power in Menengai. GDC Managing Director & CEO, Eng Johnson ole Nchoe said through Menengai, GDC will offer the cheapest tariff of power at 7 US cents (Sh7) p/kWh. 

Bottleneck

The project has reached a critical stage where 3 IPPs are now pursuing financial closure to pave way for the construction of power plants that will generate 105 MW. Initial encumbrances to construction of power plants, known as Conditions Precedents have been dully fulfilled by GDC.

Recently, GDC acquired land lease for the Menengai Project from the Kenya Forest Service (KFS). The title deed for 4,000 acres will last for 40 years. The land issue was a huge bottleneck for GDC. It has cleared the way for land utilisation for power plants. The power plants are projected to last for a period of 25 years.

Another key condition was a Steam Report – this is an independent assessment of the availability of steam to last for 25 years. JICA supported GDC by hiring an independent consultant, West Jec, of Japan to carry out the study. Recently, West Jec released the report to GDC, ministry of energy officials and to IPPs. The report demonstrated that Menengai, so far, has enough steam for 105 MW plus 20 per cent extra.

AfDB is a key financier of the Menengai Geothermal Project at cost of $120 million.

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