Power generating company, Kengen, yesterday said the construction of what will become the largest geothermal plant in East Africa started early this month.
“We are on schedule to deliver the 280MW to the national grid by 2014. This will ensure we achieve our objective of getting half of our power from geothermal sources by 2018,” said the company’s managing director, Mr Eddy Njoroge.Kengen signed a Sh 98.6 billion ($1.3 billion) funding with a Sinclair Knight Merz Ltd, a New Zealand firm in 2010 to provide the funds.The funding was to be done by a consortium of Japan International Co-operation Agency, French Development Agency, European Investment Bank, World Bank and German owned development bank (KfW).
This will see the extension of the Olkaria I and II plants that already produce a total 115 MW. Mr Njoroge said the company will need to raise at least $4.5 billion to generate 1,200 MW from geothermal wells in Olkaria and Menengai, the projects that are immediate in their plans to upscale use of geothermal power in the country.
Raise investment
Kenya has an estimated potential of between 7,000 MW and 10,000 MW of geothermal energy, but only 200 MW is exploited.
The country’s power demand has been growing at eight per cent yearly, leaving a small reserve margin of about five per cent that is wiped out when there is drought.
As a result, there has been increased investment in exploitation of geothermal that is not affected by the rainfall patterns.
To tap into the geothermal potential, the government has been encouraging private investors to increase funding to achieve the 5,000MW target set for 2030.
Mr Njoroge said all options to raise investment will be explored.
