The African Development Bank (AfDB) has approved a senior loan of $29.5m and a concessional loan of $20m through Climate Investment Funds (CIF), Clean Technology Fund (CTF) to support the development of a 35MW geothermal power plant in Kenya.
The funding has been granted to Quantum Power East Africa GT Menengai and the project is one of the three modular geothermal plants located at Menengai geothermal field in Nakuru County, Kenya.
The three plants are reported to have a combined capacity of 105MW.
AfDB, Energy, Climate and Green Growth vice-president Amadou Hott said: “Kenya has nearly 7,000MW of geothermal potential, yet only about 200MW is currently being developed.”
Quantum Power-Menengai Geothermal project is reportedly the second geothermal independent power project in Kenya, and the first to which the bank is providing debt funding as a non-sovereign operation.
As the deal’s mandated lead arranger, the bank is mobilising all necessary debt funding from other development finance institutions.
The project is part of the CTF Geothermal Concessional Finance Programme, designed to finance programmes that have the potential to deliver development results, impact, private-sector leverage and investment at scale and can be deployed rapidly and efficiently.
The power plant will make use of the geothermal resources available in the country to produce reliable, low-cost, environmentally friendly base-load electricity.
Additionally, the project is expected to provide positive environmental effects, as well as support green growth by developing renewable energy infrastructure, and enhance the base-load, grid-connected generation capacity.