In Kenya, African Development Bank marks a milestone in financing clean energy on the continent
Excited by the success of the Menengai geothermal power projects in Kenya, African development Bank plans to increase the share of its clean energy-financing portfolio to 100%. The portfolio rose from 16% in 2016 to 74% currently.
A cloud of steam rises from beneath the earth’s surface sending fine showers onto the faces of the dignitaries visiting the Menengai Well- 01, a major geothermal power project in Kenya which is set to significantly boost the country’s electricity capacity and lead the way in providing clean energy.
“Geothermal resource is uniquely abundant in this part of Africa and in Kenya. We have developed enough steam to put up the power plants here,” said Johnson Ole Nchoe, the Chief Executive Officer of the Geothermal Development Company (GDC), who accompanied Akinwumi Adesina, President of the African Development Bank and other Kenya government and Bank officials to visit the plant this month.
Menengai is one of 40 geothermal wells drilled since 2011 for the purpose of electricity generation. At full capacity, the plant would generate 12.5 megawatts of electricity to the Kenyan national electricity grid.
Since November 2016, the Bank increased its share of renewable energy financing portfolio from 14% in 2007-2011, to 64% in 2012-2016, and attained 100 percent investment in renewable energy financing in 2017. This marks a major landmark in the Bank’s commitment to finding clean and efficient energy solutions in tackling Africa’s energy deficit.
“Going this route is to industrialise in a green way,” Adesina said.
Production from Menengai will mark a new milestone in the financing of clean energy development in Africa for the Bank.
The series of wells drilled in Menengai, Nakuru County in Kenya, 180km north east of Kenya’s capital, Nairobi, is expected to generate 400 megawatts. They will supplement those drilled by GDC, Kenya’s state-owned geothermal company, which has 40 wells with a combined electricity generation capacity of 165 MW, Kenya’s Energy Cabinet Secretary Charles Keter said.
“We think electricity will play an important role in the implementation of Kenya’s Big Four Agenda through its potential to accelerate the creation of jobs through the growth of industrialisation. The most important element in development still remains light and power,” Bank President Adesina said.
With US$112.8 million investment from the Bank, through the African Development Fund (ADF), Kenya developed the Menengai Geothermal Power Project from scratch. The project has been implemented in two phases: The first phase was to ensure the development through drilling of wells, while phase two concentrated on the development of a steam gathering system.
Menengai plant to lead way in clean, safe energy supply
President Adesina commended the generation of electricity from renewable energy.
While the plant is expected to reduce carbon emissions by nearly 1.95 million tonnes per year when it becomes operational, it will also add about 1,000 gigawatts/year of low-cost electricity to some 500,000 households and 300,000 small businesses.
The successful implementation of the geothermal power project has led the Bank to consider setting up the African Geothermal Partnership to accelerate the development of renewable energy projects across Africa.
Currently, the Bank’s funding has enabled the Kenyan government to train 43 specialists on various technical fields, including exploration, drilling, health and safety matters.
Keter thanked the Bank for being at the forefront of enabling Kenya’s economic growth. In addition to financing the construction of 18 electricity transmission lines in Kenya, the Bank has also provided loans to some of the independent power producers involved in the project for the acquisition of crucial infrastructure.
The Bank’s active project portfolio in Kenya stands at US$3.1 billion. Among the beneficiaries of this investment are some of the companies involved in commercialising the geothermal power generated from the wells at the Menengai Geothermal Power Project. They include Sosian Menengai Geothermal, expected to generate 35 MW from the geothermal wells, Quantum Power East Africa GT Menengai, generating 35 MW and Orpower 22 Limited, generating 35 MW from the steam provided by the GDC.
According to the minister, Kenya hopes to extend its power supply to other countries.
“It will no longer be a dark continent in Africa because we intend to supply some of the excess power we produce from this project to other countries. It will be a continent with light,” he said.
The success of the geothermal project has motivated the Kenyan government to set an ambitious target of ensuring universal access to electricity by 2022 to all its citizens.
The Bank has committed US$12 billion investment in electricity projects over the next four years under its development priorities for Africa, known as the High 5s: Light Up and Power Africa, Feed Africa, Industrialise Africa, Integrate Africa and Improve the Quality of Life for the African People.