A look into Kenya’s $2.9 billion electricity plan

To enhance power generation and satisfy energy requirements, Kenya has launched an energy initiative valued at $2.9 billion.

• Kenya has launched a $2.9 billion energy initiative to build a 1,200-megawatt gas-fired power plant in Dongo Kundu, Mombasa.
• The project aims to meet growing electricity demand and is a joint effort between private investors and state-owned KenGen.
• Kenya plans to nearly quadruple its power generation capacity to 10,000 megawatts, with an urgent need for 600 megawatts by 2028.
• The new plant will run on imported liquefied natural gas, with Kenya planning to retire or convert all heavy fuel oil plants to LNG by 2030 as part of a clean energy strategy.

The East African country has set plans in motion to construct a 1,200-megawatt gas-fired power plant to meet its growing demand for electricity.

Concerning the initiative, Kenya is currently in the process of employing transaction advisers who would be in charge of designing and structuring the project.

Energy Principal Secretary Alex Wachira made this known via a phone call, as he also disclosed the project’s $2.9 billion estimated cost.

The gas plant, slated for construction in Dongo Kundu, Mombasa’s eastern port town, will be a collaborative agreement between private investors and the state-owned power company, KenGen.

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According to the Energy Principal Secretary, this project constitutes a key element of Kenya’s strategy to substantially augment its generation capacity, aiming for a near-quadrupling to 10,000 megawatts.

“We urgently need about 300 megawatts before 2027 and an additional 300 megawatts by 2028,” Wachira stated.

Given Kenya’s lack of a domestic fuel source, the plant would operate on imported liquefied natural gas, as reported by Bloomberg.

As the country shifts to cleaner energy sources, Kenya also intends to retire its heavy fuel oil-fired power facilities or convert them to run on LNG by 2030.

Kenya is actively pursuing a comprehensive energy transition strategy, moving decisively towards cleaner energy sources.

A key component of this national effort is the planned retirement or conversion of all power facilities that currently rely on heavy fuel oil (HFO) by the year 2030.

This ambitious target reflects the country’s commitment to reducing its carbon footprint, improving air quality, and ensuring long-term energy security through sustainable means.

Kenya’s energy goals go far beyond gas powered plant; the country also has intentions to tap into nuclear energy.

In 2023, Kenya touted plans to begin building its first nuclear power station in 2027 as the nation spoke about diversifying its energy production in response to increased demand and its goal for zero-carbon energy.

Over the years, Kenya has signed a $1 billion geothermal project at Suswa with the Indonesian government, through Masdar-backed Pertamina Geothermal Energy.

Also, AMEA Power of the UAE and Geothermal Development Co. of Kenya moved ahead to invest $800 million in the 200MW Paka Geothermal Project.