KenGen to invest US $250M in Olkaria VII plant project

The Kenya Electricity Generating Company (KenGen) has announced plans to invest about US $250M in a new geothermal plant project.

The plant, is part of KenGen’s broader strategy to add 3,000 MW of renewable energy to Kenya’s national grid over the next decade. Dubbed Olkaria VII, the energy plant will be set up in the Olkaria fields, Naivasha and expected to have a capacity of 80.3MW.

READ:Energy Recovery bags contracts for desalination projects in Morocco

Energy demands

KenGen submitted environmental and social impact assessment, submitted to the National Environment Management Authority (NEMA) for the project. This highlights the necessity for the development to meet the country’s energy demands and reducing reliance on more expensive and environmentally unfriendly thermal power plants, which the government aims to phase out by 2035.

The new geothermal plant is seen as a crucial step in stabilizing Kenya’s power supply, offering a relatively low-cost and reliable source of baseload energy. Unlike hydropower, which is vulnerable to climate change and the variability of water flows, geothermal energy provides a stable and consistent power supply.

KenGen, the largest power producer in Kenya, currently contributes two-thirds of the country’s total installed electricity capacity, which stood at 3,243 MW in 2023. The company operates a diverse portfolio of power plants with a combined capacity of 1,904 MW, with hydropower currently holding the largest share at 825.6 MW. However, geothermal power is rapidly growing, and with the addition of Olkaria VII, geothermal capacity will reach 799 MW, closely rivaling hydropower.