Kengen has revealed plans to invest as much as KSh216 billion in four new power plants in Kenya over the next five years, Bloomberg reports. The leading power generator is shifting focus from sources like hydroelectric power and thermal power to geothermal power.
Kengen is the largest energy generating company in East Africa. The company has drilled over 310 geothermal wells since its establishment and supplied 1818 Megawatts to the national grid.
Geothermal energy is becoming a major source of revenue for Kengen, through drilling projects in Kenya and neighbouring countries like Ethiopia and Rwanda. In February this year, the firm secured a $6.6 million (KSh714 million) drilling contract in Djibouti as per the Bloomberg article. Kengen said it is in talks with Rwandan and DRC officials concerning geothermal projects in the countries.
The energy company also plans to increase electricity supply from geothermal plants to nearly 60% of the electricity used in Kenya from the current 50%, by 2030.
One of the biggest hurdles the company faces is the high cost of drilling wells which can rise to $6 million for a single well. In addressing this challenge, Kenya established the Geothermal Development Company to take the risks associated with geothermal projects. Kengen also faces stiff competition from alternative energy sources like solar and wind power which require less capital investment compared to geothermal power.