KenGen unveils plan for 280MW geothermal plants

The country’s main power generator, Kenya Electricity Generating Company (KenGen), is seeking contractors to put up two geothermal power plants.

KenGen is inviting prequalification bids for constructing two power plants of 280 megawatts geothermal power generation capacity with steamfield, substations and transmission, it said in a procurement notice.

The company already producing more than 200MW of electricity from geothermal sources plans to add 280MW of geothermal power at a cost of Sh104 billion ($1.3 billion) by 2013.

KenGen said the government had received financing from the International Development Association (IDA), the Japan International Cooperation Agency (Jica) and the French Development Agency (AfD) for electricity expansion, the Olkaria IV, and 1 Additional Units Project.

“In addition, the Government of Kenya and the Kenya Power and Lighting Company (KPLC) have applied for financing from the European Investment Bank (EIB) and the German Development Co-operation (KfW) and intend to apply the proceeds towards payments under four contracts,” the company said.

KenGen in March signed a loan agreement with Jica for Sh25.84 billion ($323 million) and expressed confidence in securing the outstanding $700 million.

Part of the project entails boosting electricity output at KenGen’s Ol Karia 1 plant to 140 KW from 45 KW within finances from JICA.

The prequalification of bids should be made by July 20 with the invitation for bids for the four contracts expected to be made between September and February next year.

Energy is a key issue in the country with industrialists often protesting against unreliable and costly supplies.

“Looking ahead, the country’s greatest infrastructure challenge lies in the power sector, where a further 1,000 megawatts of generating plant are needed over the next decade, a doubling of current capacity,” a World Bank implemented programme on infrastructure, said this year.

Power grid

In the 2010/11 Budget, Finance minister Uhuru Kenyatta said the energy sub-sector will be allocated Sh35.1 billion this year with Sh15.6 billion going towards the expansion of the national power grid.

Some Sh11.6 billion will go towards harnessing geothermal resources as well as initiate exploitation of coal reserves with special emphasis on adding 280 megawatts of geothermal capacity by 2013.

Treasury also plans to direct Sh5.4 billion to fund the rural electrification to help increase the number of public facilities connected to the national grid.