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Kenya Seeks Investors For 300 MW Geothermal Power Project
03/01/2013
NAIROBI (Reuters) - Kenya is seeking investors to build three power plants to harness steam in the Rift Valley, the state-run Geothermal Development Company (GDC) said on Friday.
The GDC said it expected to drill 120 wells in the first phase of the project.
The three plants are to produce 300 megawatts of power by 2018 and the GDC estimates the project field has a potential of about 750 MW.
"A period of 24-36 months will be provided for power plant construction," the GDC said in a statement, adding that investors would be required to provide 60-80 percent of the required capital.
It said investors that qualify would be expected to be able to raise at least $400 million for the development and the government would not provide risk guarantees.
It encouraged would-be investors to look for these from organisations such as the World Bank's Multilateral Investment Guarantee Agency.
Kenya currently has 1,664 MW of capacity against a maximum recorded demand of about 1,410 MW but demand is growing.
East Africa's biggest economy is expected to expand by 5.9 percent in the 2013/14 fiscal year which ends in June.
The government in November said it wanted to add 5,000 MW to Kenya's power output by 2017 to unleash even faster economic growth, which is expected to raise power demand to 15,000 MW by 2030. It also aims to halve the cost of power generation in three to four years, mainly by replacing diesel generation.
Geothermal energy requires a large initial investment, mainly due to expensive drilling of wells, but is more reliable than rain-fed hydropower generation in periods of drought.
Kenya Electricity Generating Company (KenGen) has 157 MW of geothermal capacity and is constructing a 280 MW geothermal power plant at Olkaria in the Rift Valley.
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