M a r k e t N e w s
Kenya:Business News Kenya on track to boost geothermal energy generation
Posted on : Thursday , 28th August 2014
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Kenya has invited bids for construction of two new geothermal plants as part of the country's plan to boost electricity production by 5000MW in three years. The new plants, with a capacity of 60MW, will be completed by the end of 2014 and is part of several projects designed to tap into Kenya 10,000 MW geothermal power potential, according to Oxford Business Group's most recent economic update on energy.
According to a Ministry of Energy and Petroleum's 2013-2016 investment prospectus, Kenya's geothermal generation makes up just under 250MW of the total electricity production of roughly 1650MW. Hydro comprises the largest proportion of generation, at around 800MW, followed by thermal at around 600MW.
However, with suppressed demand peaking at levels of 1,400MW, according to the ministry - and unsuppressed demand forecast to reach 1,700MW – the need to expand and diversify the power base load has become necessary. Lower-than-expected rainfall in 2013 and 2014 has added to the urgency, reducing the output of Kenya's hydro-power stations.
Masinga reservoir, which feeds Kenya's largest hydroelectric facility- the 550MW Seven Forks, was at only one-third capacity by mid-2014.This prompted the country to slow exports to neighbouring countries and increase electricity imports.
Kenya is one of a handful of African countries, including Ethiopia and Zambia, which is exploring geothermal potential. The discovery of Kenya's geothermal energy resources dates back to the 1950s, when the first test wells were drilled at Ol Karia, near Nairobi. Kenya completed its first geothermal power plant, a 15MW facility, in 1981 at the same location. Since then, Kenya has also turned to private producers, with IPPs such as US-based Ormat Technologies 50MW plant in Olkaria contributing to geothermal production. Oxford Business Group (OBG) is a global publishing, research and consultancy firm, which publishes economic intelligence on the markets of Africa, Asia, the Middle East and Latin America. Construction on a number of facilities is already underway.
Expansion of Ormat's plant at Olkaria is ongoing while tenders for first phase of the plant in Menengai – with the potential a 400MW potential – have been awarded to three firms. The firms, which include Ormat, along with Finland's Quantum and local firm Sosian Energy, were selected late last year, and will reportedly construct a 35MW steam plant under a build-own-operate model, at a cost of Sh4 billion each.
Source : investmentkenya.com
