African Development Bank decides not to fund coal project in Kenya
With a decision to withdraw from potentially investing into a planned coal plant in Kenya, the African Development Bank shows commitment to sustainable energy development in Africa. This is a positive sign for Kenya and future geothermal development in the country.
The question remains, why the heck in the first place, would the African Development Bank look into financing a coal-fired power plant in Kenya. But these are good news from Kenya and Africa in general as it highlights that the decisions by top banks and development institutions to restrict coal investments, clearly has reached Africa as well.
With an energy mix dominated by renewable energy sources geothermal and hydro, as well as wind coming in, even looking into coal simply made no sense.
Reuters now reported earlier this month, that the African Development Bank will not fund the coal plant and has no plans to finance new coal plants in the future. The decision seems to be based on an environmental and social impact assessment.
The step of AfDB out of the project is a blow to the Kenyan and Chinese investors behind the project, but one that clearly makes sense.
Today, around 50% of the electricity supply of Kenya is provided by geothermal energy and with additional projects in the pipeline there should be sufficient geothermal power going forward. With its baseload capacity it provides an important value in both secure and constant electricity supply, while also a cost-effective one.
We reported earlier this month on a report that compared geothermal to potential coal-fired power plants in Kenya and clearly highlighted the advantages of geothermal.