Kenya will spend more than Sh130 billion within two years to put up 280 megawatts geothermal power plants in Olkaria near Naivasha. Billed as the largest single one-off geothermal project in the world, the plan will consist of two power plants of 140MW each which should be up and running by February 2014. The project will raise the country’s geothermal capacity from the current 200MW to 480MW.
Electricity generator KenGen says the project will increase Kenya’s electricity reserves by 30 per cent which will lead to drastic cuts in constant power rationing. The completion of the ambitious project is also expected to give electricity consumers reprieve in terms of their monthly power bills as it will reduce reliance on hydro power which is dependent on the weather patterns.
According to KenGen managing director Eddie Njoroge, a recent drought in Kenya has meant that 62 per cent of hydro capacity is not available at the moment, partly explaining why cost of electricity has almost tripled in the last few months. “The situation has been compounded by fluctuating global oil prices which have resulted in skyrocketing power production costs which have driven up the cost of electricity,” Njoroge said.
It will also help to partly eliminate use of emergency expensive power from diesel generators. “The long term cost of geothermal is low in comparison to other sources of electricity like thermal, hydro and wind,” KenGen said. The company said yesterday it has signed a contract with a consortium of Japanese and South Korean companies to undertake the development of the project. While Japan’s Toyota Tsusho Corporation will supervise the entire implementation of the project, Hyundai Engineering and Construction will supply the steam generators.
The massive development, expected to cost close to Sh137 billion, is being undertaken on the grounds that Kenya’s has run out of hydro capacity which means that no reliabe power can be generated from water anymore. With a growing economy, the demand for power in Kenya have been rising by an average eight per cent every year. KenGen estimates that 800MW of energy is needed every year in the country and this will most likely come from geothermal sources.
The country currently has around 1600MW of installed power capacity but demand is estimated to pick to 15, 000 by 2018 in line with Vision 2030 aspirations. Out of this, 4, 700MW will be generated from geothermal sources. The Rift Valley is estimated to have a potential of 7, 000MW of geothermal power.
The project is being funded by the Japan International Cooperation Agency, French Development Agency, European Investment Bank and KenGen for the power plants. The development of the steam fields in funded by the World Bank, German Development Bank and KenGen. The Kenyan government is funding the drilling of all the wells required for the project.