Work on $1.3bn Olkaria IV geothermal plant starts

Saturday July 21 2012

A geothermal well at Menengai Crater in Nakuru. Construction works on the 280MW Olkaria IV geothermal power plant, located 120 kilometres from the capital Nairobi, starts on Monday, July 23. Photo/File

Kenya will embark on the construction of the continent’s largest geothermal project this week, as the country moves to bring on stream green energy projects to cut its dependence on hydro and thermal power.

Construction works on the 280MW Olkaria IV geothermal power plant, located 120 kilometres from the capital Nairobi, starts on Monday, July 23.

President Mwai Kibaki will preside over the ground-breaking ceremony.

The plant will be built by a consortium of Japanese firm Toyota Tsusho Corporation and Hyundai Engineering and Construction from South Korea, and is scheduled for completion in early 2014.

The $1.3 billion power plant is part of Kenya’s effort to diversify its power source as it moves to cut reliance on hydropower, which currently contributes 46 per cent of the country’s electricity needs, but which is vulnerable to weather fluctuations.

Currently, the country has a total electricity generation capacity of 1,500MW of which geothermal contributes a party 200MW, despite the country having the potential to generate up to 15,000MW from this source.


Out of the total installed capacity, hydro contributes 761 MW, thermal 525 MW, geothermal 198, wind 5.45 MW, co-generation 26MW and isolated grid 17MW.

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The country plans to raise the contribution of geothermal from the current 13 per cent to about 50 per cent by 2018.

This should help it wean itself off the more expensive thermal and diesel powered electricity sources. Though geothermal is expensive to install, it requires very little running time.

With only 15 per cent of Kenyans connected to the national grid, the country is currently implementing a development plan dubbed Vision 2030, that among other things seeks to develop the manufacturing sector.

Over the next eight years, the government estimates that flagship projects under Vision 2030 alone will require at least 860MW, with a proposed steel and iron smelting plant to be based in Meru requiring 315MW.

In a government report titled Least Cost Power Development Plan, it is projected that overall demand for electricity will grow at an annual rate of 9 per cent in coming years.

This will put the demand of electricity to at least 15,000MW by 2030, of which 5,000MW will be generated from geothermal.

“Geothermal resources are the choice for the future generating capacity in Kenya. The optimum solution indicates that geothermal capacity should be increased from the current 198MW to 5,530MW in the planning period, equivalent to 26 per cent of the system peak demand by 2031,” says a government report on energy sector.