With this development, Globeleq is expected to soon issue a notice to proceed to the Toyota Tsusho Corporation (TTC) and their fully owned subsidiary CFAO Kenya Limited, the chosen engineering, procurement, and construction (EPC) contractor for the project, for the start of the construction activities.
The planned 35-MW geothermal power project will be the first geothermal plant of Globeleq, one of three Independent Power Producers (IPPs) assigned to build power plants to utilize the geothermal resources in Menengai. Steam will be supplied to the project by GDC under a 25-year project implementation and steam supply agreement. Globeleq will operate and maintain the power plant once it reaches commercial operations in 2025.
Once operational, electricity will be sold to Kenya Power, the national distribution company, under a 25-year power purchase agreement.
A groundbreaking ceremony for the power plant was held in June 2023 followed by the announcement of the selection of Fuji Electric as the supplier of the geothermal power facility.
“Menengai is an excellent example of how lenders and independent power producers can work with Governments to successfully harness natural resources and generate clean and reliable power. We are excited to be starting construction on our first geothermal power plant and look forward to other opportunities in the region. I would also like to thank our partner GDC, the senior lenders at AfDB, Finnfund and TDB, our EPC contractor, TTC, and our offtaker, Kenya Power, for the achievement of this important milestone and their patience during the process,” said Mike Scholey, CEO of Globeleq.
“The financial close reached by Globeleq and its partners is a great milestone for the geothermal sector in Kenya. It affords the country another opportunity to develop 35 MW more of clean, affordable, and reliable power. The Menengai geothermal project is of strategic national value especially at this critical moment when Kenya is determined to decarbonize its economy. The available geothermal resource in Menengai is plentiful and at GDC we are happy that we made the project bankable for investor-entry,” added Paul Ngugi, Managing Director and CEO of GDC.
