Kenyan Energy Companies sign Multimillion Dollar Geothermal Energy Deals

Kenya currently receives most of its renewable power from erratic hydroelectric sources, which struggle to meet the nation’s energy demand, and supply varying levels of electricity to the grid.

Now, two government-owned companies exploring the geothermal potential in Kenya have signed multimillion dollar deals to develop geothermal power plants in an effort to boost the country’s clean, reliable energy.

Kenya Electricity Generating Company (Kengen) and Geothermal Development Company (GDC) have been exploring geothermal sources, mainly situated in the Great Rift Valley province.

Kengen has been exploring the Olkaria steam fields in Naivasha, 100 kilometres southwest of Nairobi, and recently signed a $140 million contract with Sinopec of China to develop two 140MW power plants there. The 280MW project is expected to be completed in 27 months and will add an extra 25 percent of power to the national grid.

Eddy Njoroge, MD of Kengen, said that although “the upfront costs for its generation are high, geothermal is cheaper and cleaner than other forms of energy and the government is putting more emphasis on geothermal. This financing is a major step in the journey to realize this reliable energy.”

Meanwhile, GDC has been exploring in the dormant Menengai crater, 200 kilometres southwest of Nairobi. A 400MW plant is expected to be completed by 2016, and GDC estimates that there is enough potential geothermal capacity for a total 1,600MW.

GDC also studied the Bogoria-Silali block in the Central Rift Valley and estimates its potential at 3,000MW. They have already announced plans to develop 2,000MW there by 2023.

By. Joao Peixe of Oilprice.com