Symbion Power, the American electricity generation firm that took over the Kibuye Power 1 methane gas-to-electricity power plant will embark on a phased increase of the unit’s generation capacity from 3.6 to 50MW over the next three years.
Symbion bought Kibuye Power 1 (KP1) at an undisclosed price after the plant went into liquidation when it failed to pay its creditors. The American company now says it plans to increase generation capacity first to 25MW by 2018 and eventually to 50MW by 2019.
“The plant (Kibuye Power 1) was handed over to us last week and we are currently focused on getting it restarted because it was shut down during the sale process. We will start the upgrade early next year and have 25MW within 16 months of commencing work,” Symbion’s chief executive officer Paul Hinks said.
KP1 is the second power project Symbion is developing on Lake Kivu after signing an earlier concession and power purchase agreements for another 56MW methane to power plant on Lake Kivu last December. Under that agreement, the first 14MW are expected in 2018.
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The upgrade of KP1, will give Symbion a combined gas-to-electricity capacity of 106MW on Lake Kivu that will be almost equal to the current 119MW of installed generation capacity or nearly 50 per cent of Rwanda’s current supply that includes imports. Symbion says it expects to invest around $350 million in the two projects.
“Rwanda is an incredibly beautiful country blessed with exceptional leadership and an outstanding population of proud, industrious millennials. In a period of only 22 years it has transformed itself into an investment destination ranked second only to Mauritius in the World Bank’s annual Doing Business Index,” Mr Hinks said.
Explaining why his company is increasingly investing in Rwanda energy sector adding that its 12 million strong population was more of an asset.
Dogged by shareholders’ wrangles coupled with court cases, in Rwandan and international courts KP1 has been operating below capacity. While the plant was designed to generate 5MW, it has been adding only 2MW the national grid.
Dane Associates, a Scottish firm owned 70 per cent in the project before Rwandan government successfully filed for liquidation of KP1. Dane Associates sought redress through international arbitration accusing Rwanda of breaching its contractual obligations under the project.
The bad blood between the Rwanda government and Dane Associates came to the fore in 2005 when the latter allegedly failed to account for $3 million in pre-project costs.
American independent power producers have taken a keen interest in the Lake Kivu methane gas projects and are now eyeing the Democratic Republic of Congo side.
Another US firm, Contour Global, is also producing 26MW in the lake, further validating the reliability and safety of the gas extraction methodology.
“We anticipate that Rwanda and the DRC will collaborate for Lake Kivu gas extraction and on our own part we are willing to assist DRC with technological support so that they too can safely and efficiently extract methane gas from their side of the lake.
The methane in Lake Kivu is estimated to be sufficient to generate 700 MW of electricity over a period of 55 years. Rwanda’s share of the total generation potential is about 350 MW, with the rest being DRC’s share.