UK, Kenya agree to fast-track geothermal and green projects
UK Prime Minister Rishi Sunak and Kenyan President William Ruto have agreed to fast-track green investment projects including the Menengai Geothermal Project.
UK Prime Minister Rishi Sunak and Kenyan President H.E. William Ruto met at the COP27 climate summit and agreed to fast-track six green energy projects in Kenya worth KES 500 billion (approx. USD 4.1 billion). One of these six projects is the Menengai geothermal project being developed by the Geothermal Development Company (GDC) and Globeleq with a planned 35-MW capacity.
The new clean energy investments will be the flagship projects of the UK-Kenya Strategic Partnership, a five-year mutually beneficial agreement between the two countries. The UK Government will commit KES 2 billion (approx. USD 16.4 million) to a new guarantee company that will lower investment risk and unlock KES 12 billion (approx. USD 98.6 million) of climate finance for Kenyan projects over the next three years.
The Menengai Geothermal Project has an investment cost of KES 12.5 billion. State-owned GDC conducted drilling of the wells for this project after which private players were invited to set up the power plants under build-own-operate contracts. The first power plant by Sosian Menengai Geothermal Power is expected to start operations by the end of 2022. The project had also previously signed a power purchase agreement with Kenya Power and Lighting Co. Ltd (KPLC) for one of the cheapest tariffs for baseload renewable power.
The other green investment projects included in this agreement are the expansion of the solar plant in Malindi, the Grand High Falls Dam, the Nairobi Railway, the United Green agro-industrial processing system, and a new guarantee company that aims to de-risk investments in Kenya.
“The UK and Kenya go far when we go together. By fast-tracking finance into these clean, green projects with honest, reliable investment the UK is supporting Kenya to advance and maintain its continent-leading climate credentials – with mutual benefits for both our countries,” said British High Commissioner to Kenya Jane Marriott.
The UK-Kenya Strategic Partnership was signed in 2020 between former Prime Minister Boris Johnson and former President Uhuru Kenyatta. It is founded on five pillars – mutual prosperity, security and stability, sustainable development, climate change, and people to people.
Source: UK Government