Kenya calls for “action” from developers to start power production at geothermal project

Energy and petroleum cabinet secretary Charles Keter said during a tour of the Menengai geothermal project last week he expected the three IPPs contracted by the state-owned Geothermal Development Company (GDC) to complete construction “immediately, but not later that the 30 days’ notice that GDC has given them”.

Kenya’s government has already invested 40 billion Kenyan shillings (KES) ($394 million) in the Menengai project “and GDC has done its part by providing steam and developing the steam pipeline that will supply steam to the power plants”, Keter said.

Keter said there is already 137 megawatts (MW) of steam available at the project “which is more than the required 105 MW for the first phase”. The IPPs must “demonstrate that they can truly put up the power plants they bid for”. The government wants to “see action and will not extend the (30-day) deadline”, Keter said.

Menengai, a project 185 kilometres northwest of Nairobi, started in 2011. The project has an estimated total electricity generating potential of 1,600 megawatts (MW) and had been expected to be generating 810 MW of electricity – about half of the country’s current total electricity generation – by this year.  

However, according to media reports, there have been disagreements over the quantity of steam available at the site and its sustainability.

According to the GDC, the three IPPs – Quantam Power East Africa, Orpower 22 (a consortium of Ormat, Civicon and Symbion) and Sosian Energy – are investing $262.5m in the construction of the power plants. Each is expected to install a 35 MW power plant in Menengai and pay the GDC for the steam they will use to generate electricity. The project is expected to give 500,000 homes and 300,000 businesses “access to low-cost power”.

The Kenya Power and Lighting Company Ltd will purchase the power from the plants. The Kenya Electricity Transmission Company Ltd has set up a 132kV substation to distribute power generated by the plants to the national grid, the GDC said.

In 2014, the African Development Bank approved a $12.7m partial risk guarantee to “ease investor risk” for the initial phase of the Menengai project in Kenya.

According to the Kenya Electricity Generating Company Ltd, geothermal generating capacity in Kenya is currently at 533.8 MW, following the start of full operations of the 280 MW Olkaria geothermal plant.  

The Olkaria plant in the Rift Valley province comprises the 140 MW Olkaria IV and units four and five of Olkaria I, each with a generating capacity of 70 MW. The World Bank confirmed in February 2015 that the Olkaria I units were successfully commissioned earlier that month, marking the completion of the project.

Other partners in the Olkaria project include the Japan International Cooperation Agency, the European Investment Bank, the French Agency for Development and the German government-owned development bank KfW Entwicklungsbank.