Economy

KenGen, GDC differ over steam power

geothermal

GDC’s Olkaria steam well at Menengai, Nakuru. FILE PHOTO | NMG

Power producer KenGen and Geothermal Development Company (GDC) have clashed over steam outlook as Kenya races to grow its stock of green energy.

KenGen claims its most productive well in Naivasha’s Olkaria has a capacity to produce 30 megawatts of electricity, making it the largest in Africa.

“As far as we’re concerned our 30-megawatt well in Olkaria is the largest in Africa,” Mr Abel Rotich, KenGen’s geothermal development director said during a media tour in Olkaria fields.

However, Mr Paul Ngugi, a manager at GDC, claims the agency’s Well 1A, with a capacity of 30.6 megawatts, in Menengai, Nakuru, is the single largest in Kenya and Africa.

GDC is fully owned by the government. It is mandated to drill exploration wells in search of steam on behalf of investors to derisk the venture before handing them to power producers who pay for the steam that they convert to electricity for onward sale.

GDC has seven rigs while KenGen, which drills and produces electricity, has three operational rigs.

35-megawatt search

GDC will sell its Menengai steam to American firm Ormat Technologies, local company Sosian Energy and Mauritius-based Quantum Power, each of which plans to separately construct a 35-megawatt plant each.

KenGen, #ticker:KEGN listed on the Nairobi Securities Exchange and 70 per cent owned by the government, will pipe steam from its 30-megawatt well, alongside dozens of other smaller wells to generate electricity at the158-megawatt Olkaria V power plant under construction. The plant will be completed by July 2019.

It took the power producer 46 days to drill the 30-megawatt well at a cost of $4.5 million (Sh455 million) in 2013. It costs an average of $5 million to sink a geothermal well, reaching depths of up to 3.5 kilometres.

An average well yields five megawatts, meaning drillers save cash when they strike high-yielding production wells.

Kenya is currently ranked the ninth largest producer of geothermal electricity in the world and the leader in Africa with a capacity of 630 megawatts, according to Renewables Global Status report 2017.

The United States is the world leader with a geothermal output of 3,600 megawatts.