Kenya Power signs deal for 140 MW plant

Apr 08, 2013 12:00 AM

The Kenya Power and Lighting Company Limited (Kenya Power) has signed a Power Purchase Agreement with Africa Geothermal International Kenya Limited (AGIL) which is setting up a 140 megawatt geothermal project in Longonot.

Kenya Power Managing Director Joseph Njoroge said the PPA is an important step in enabling the country meet its Vision 2030 goals of tapping geothermal power that is cost effective and environmentally friendly.

"Geothermal power is part of the country's strategy of diversifying the generation mix for security of supply and reducing the overall cost of electricity because it does not have fuel cost," he said.

Njoroge said that geothermal unlike other renewable energy sources such as wind, solar or hydroelectric is not dependable upon weather; geothermal power plants in Kenya and around the world operate at high capacity factors and provide needed base load generation.

Under the power deal, AGIL will develop, construct, own, operate and maintain the geothermal project with Kenya Power purchasing the power generated.

The PPA has a term of 25 years after the power plant's commercial operation date, scheduled for 2018. Project development and construction activities will be carried out in the interim period.

Chief Executive Officer of AGIL, Fassine Fofana, emphasised that the project is a significant milestone for the geothermal industry in Kenya and East Africa as it brings into the geothermal sector private investment for a major green field project.

"This 140 MW PPA provides the AGIL stakeholders the off-take certainty needed to advance the project and provides Kenya Power with an important addition to their generation plan," said Fofana.

The Longonot Geothermal Project is directly adjacent to the Olkaria geothermal complex.

AGIL has performed all of the surface exploration and development activities to ready the project for drilling expected to commence in early 2014.

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