AfDB and Kenya Launch USD 150m Geothermal Project
The African Development Bank (AfDB) and Kenya’s Geothermal Development Company (GDC) have launched the Menengai geothermal project, designed to produce electricity for 500,000 households and displace two million tons of CO2 per annum.
GDC is a state-owned company charged with boosting geothermal energy generation in Kenya. The project, launched on 12 April in Nairobi, is the first geothermal project developed exclusively by GDC.
Located in the African Rift system, the Menengai project is expected to set the stage for investments to help meet the country’s rapidly increasing demand for power, and transform the country into a competitive clean energy economy.
In addition to supplying households, the project will cater to 300,000 small businesses and provide a further 1000 GWh to other businesses and industries on completion.
Speaking at a two-day workshop for the launch, AfDB regional director for East Africa, Gabriel Negatu, said: “Kenya has been sitting on this amazing natural resource and today, at long last, the ingredients for tapping into it seem to be coming together.”
Silas Simiyu, GDC’s managing director and CEO, said: “We are happy that the Bank found it fit to provide the necessary finances. The loans will be critical in affording Kenya an opportunity toward energy sustainability and independence.”
In December 2011, AfDB approved the financing for the project, consisting of a loan of USD 125 million loan from the African Development Fund, AfDB’s concessionary or ‘soft loan’ arm and a combined loan, and grant of USD 25 million from the Scaling-Up Renewable Energy Program under the Climate Investment Funds (CIF), hosted by AfDB.
The Menengai project is the first of its kind to be approved by a multilateral development bank under the CIF to a low income African country.