In this special four-part series, Alternative Energy Africa will look at Kenya’s feed-in tariff and the revisions the government is making to create a more investor friendly climate for the country’s renewable energy sector.
As Kenya has addressed the need to up its revision on its 2008 feed-in tariff (FIT) system, it comes as no surprise that energy from geothermal sources would need to be included in the mix. With the establishment of its local geothermal company, the Geothermal Development Corp. (GDC), in 2008, Kenya has made even greater strides in its geothermal sector. In November, the GDC announced plans to increase the country’s power output by geothermal energy. CEO Silas Simiyu said that over the past 30 years, the country has only harnessed 167 MW of power out of the potential 7,000 MW. "Geothermal in this country has a base load of 95% making it the most reliable source of energy," he said.
Simiyu said that the main issue that the sector faced was securing investment; it now appears that outside investment will become a reality. “Over a period of 10 years the government would need to invest $4.5 billion in up-scaling the contribution of geothermal energy to 49% of its energy mix which we would be willing to partner with the government to make it possible,” Obiageli Ezekwesili, the World Bank vice president, said.
In October
Alternative Energy Africa reported that Kenya was perhaps the easiest place to start geothermal projects as the country has proper framework in place and has ventured into the field the longest with Ormat (Investor Update). Undoubtedly, the additions to its FIT system regarding the geothermal sector will only propel its ultimate goal of generating at least 4,000 MW of geothermal energy by 2030 (under the country’s development blue print Vision 2030).
The Kenyan Ministry of Energy has added that a fixed tariff “not exceeding $0.085 kWh of electrical energy supplied in bulk to the grid operator at the interconnection point” is set to apply for 20 years from the date the plant was first commissioned, applying to the first 500 MW. The report also said that the “tariffs shall apply to individual geothermal power plants who effective generation capacity will not exceed 70 MW.”
Ezekwesili commented that Kenya shouldn’t rely solely on foreign investment for geothermal, but search for ways to shore up local backing. And in mid-Janaury,
Therefore, a fixed tariff of up to $0.20 per kWh will apply to the first 100 MW of power generated using solar energy generating 500 kW to 10 MW. A non-firm power fixed tariff under $0.10 per kWh will apply to the first 50 MW of non-firm power generating solar-based power plants within the country.
This could propel others to move up their expansion plans within the country, such as mobile operator Vodafone. The company, in collaboration with Alcatel-Lucent, launched a pilot site that will use a hybrid of wind and solar energy for mobile services in
Interested in more information about Kenya’s geothermal sector? Alternative Energy Africa will have an exclusive interview in its May/June issue with GDC’s spokeswoman Ruth Musembi.
Previous articles in Alternative Energy Africa’s special series:
Subscribe to Alternative Energy