Wednesday, June 15, 2016

East Africa: Development of Geothermal Energy Important for Region

Exploration of geothermal in the East Africa region (ESI Africa)

Explore different approaches to developing geothermal to accelerate the development cycle, mitigate early risk, and lower tariffs.

The role of geothermal energy in the power mix for East Africa is a topic of on-going discussion among government officials, donors, and developers. As a baseload, renewable resource, geothermal is quite attractive for countries with high renewable targets, or that are looking to hedge against volatility in oil and gas markets, or replace unreliable or expensive base load power.

On the other hand, the high upfront costs, limited ability to de-risk the resource without significant capital deployment, and the long development cycle pose significant challenges to the viability of geothermal as a significant source of energy in East Africa where downward pressure on tariffs is in conflict with required returns from developers. As such, the geothermal community in East Africa continues to explore different approaches to developing geothermal to accelerate the development cycle, mitigate early risk, and lower tariffs.

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