Kenya adds to geothermal power at Menengai

Globeleq and Kenya’s Geothermal Development Company break ground on 35MW power plant, part of first phase of expansive Menengai Geothermal Project; complex estimated to have 1.6GW power generation potential

Globeleq and its project partner Geothermal Development Company (GDC) last week broke ground on the development of the 35MW Menengai Geothermal Power Plant. The plant is located in the Menengai Crater, about 30km from the County capital Nakuru.

The officials present at the ground breaking ceremony included Hon. Rigathi Gachagua, Deputy President of the Republic of Kenya; Davis Chirchir, Cabinet Secretary of the Ministry of Energy & Petroleum; Jane Marriott, British High Commissioner to Kenya; Mike Scholey, Globeleq’s CEO; and the Paul Ngugi, CEO of GDC.

In a statement, Mike Scholey noted that the event symbolizes “Globeleq’s commitment both to Kenya and to playing a leading role in delivering Kenya’s energy transition.” Paul Ngugi added that GDC’s efforts to de-risk the geothermal sector in Kenya have culminated in the ground breaking for the construction of the plant.

Part of Menengai geothermal complex

The 35MW power plant is a greenfield project which is part of the first phase of the expansive Menengai Geothermal Project, the second large-scale geothermal complex in Kenya after Olkaria.

The complex is estimated to have a power generation potential of 1.6GW. The Project will be developed in five phases with the target being the development of 465MW.

The first phase will involve the development of 105MW. GDC has awarded contracts to three Independent Power Producers (IPPs) – of which Globeleq is one – to finance, procure, construct, and operate three power plants, on a Build-Own-Operate (BOO) model. GDC will operate 13 wells which will feed the steam gathering system for the first phase.

Globeleq’s 35MW Menengai power plant has an estimated cost of $108 million and will be the company’s first geothermal plant and its second clean energy project is in Kenya after its Malindi Solar plant.

Globeleq to operate

Last December the company signed financing agreements with the African Development Bank, the Trade & Development Bank, and Finnfund for the provision of US$72 million in debt funding for the project. The company expects the Menengai project to reach financial close within the next two to three weeks subject to the government fulfilling the remaining conditions precedent.

Globeleq will operate and maintain the power plant when it begins commercial operations in 2025.  GDC will supply steam to the project under a 25-year project implementation and steam supply agreement. The power from the plant will be sold to Kenya Power under a 25-year power purchase agreement.

According to GDC, at a tariff of US¢7 per kWh, Menengai is cheaper than the average tariff of US¢9 per kWh. The geothermal plant will generate enough affordable clean energy for about 750,000 Kenyans. The construction is expected to create about 200 jobs and when completed the plant will provide up to 40 permanent jobs.

Toyota Tsusho Corporation from Japan is the EPC contractor for the project while Fuji Electric will manufacture and supply the steam turbine and generator.

UK-based Globeleq is an independent power producer with four regional offices across Africa. Geothermal Development Company (GDC) is a fully government-owned company tasked with developing steam fields and selling geothermal steam for electricity generation to Kenya Electricity Generating Company PLC (KenGen) and private investors.

Energy & Utilities reported last month on uprating projects at the large Olkaria geothermal power complex in Kenya. E&U reported last year on Ethiopia's first geothermal power stations.