The African Development Bank (AfDB) and the Climate Investment Funds’ (CIF) Clean Technology Fund (CTF) have agreed to provide funding to Quantum Power East Africa GT Menengai to develop the first private sector-led 35MW geothermal power plant in Kenya.
As per the agreement, AfDB will provide a senior loan of $29.5m and a concessional loan of $20m from CTF to the company.
The funding will support in the development of the geothermal power plant at the Menengai geothermal field in Nakuru County, Kenya, which is one of the three modular geothermal plants in the Menengai field with a combined capacity of 105MW.
The project is part of the CTF Geothermal Concessional Finance Program under the Dedicated Private Sector Program. The program has been designed to finance projects that can deliver results, while stimulating private investments.
The geothermal project is expected provide positive environmental effects and contribute to green growth by developing renewable energy infrastructure that could result in annual savings of up to 95,100 tons of CO2 equivalent.
Besides, it is anticipated to increase the base-load, grid-connected generation capacity to serve 48,800 households annually.
AfDB power, energy, climate and green growth vice-president Amadou Hott said: “Kenya has nearly 7GW of geothermal potential, yet only about 200MW is currently being developed.
“The partnership between the African Development Bank and the CIF to contribute to Kenya’s efforts in scaling up the development of this renewable resource and boost economic growth is commendable.
“The deployment of CTF funds is directly contributing to unlocking the power of the private sector in driving long-lasting market transformation and mitigating risks in the geothermal power sector.”
Quantum Power-Menengai Geothermal Project is the second independent geothermal power project in Kenya, which is expected to strengthen public-private partnerships and enable the country to tap into its abundant geothermal resources to provide reliable, low cost, environmentally friendly base load electricity.