The Climate Investment Funds’ Clean Technology Fund (CTF) has approved a $29.65-million concessional loan to Kenya to cofinance up to two geothermal projects to increase the country’s power capacity, particularly drawing on untapped geothermal resources in the Rift Valley.
The programme will be implemented with support from the African Development Bank (AfDB), with the geothermal projects to be structured as independent power producers (IPPs).
AdvancementsThe CTF for geothermal genera- tion will build on the energy advancements already under way in the development of the country’s Menengai geothermal field.
To create a sustainable energy future, Kenya’s government recognises that it needs to sustain a stable investment climate for private- sector participation in the energy sector, expanding transmission and distribution networks to deliver power to customers, maintaining cost-reflective tariffs and reducing inefficiency in the sector to sup- port more affordable end-user tariffs.
Investment FlowsA key government measure in this regard is to promote IPP schemes selected through international competitive bidding processes to enhance investment flows from the private sector into the power sector.
AfDB CTF coordinator Joao Duarte Cunha notes that the infusion of capital will serve to build investor confidence and improve bankability of these resources.
“The success of the IPPs deve- loped in this programme can serve as a beacon for other countries looking to achieve similar green energy goals.”
Transformation of the geothermal-energy sector is a core part of Kenya’s economic growth plan for its expanding and increasingly urbanising population.
In its 2030 vision, the country identified energy and electricity as key elements of its economic transformation, with geothermal energy as the lead technology.
It was estimated that by 2020, the country’s projected installed energy, capacity would triple from 2 177 MW to 6 766 MW, with geothermal contributing around 2 000 MW.