Kenya: KenGen’s successful bond issuance allows adding 500 MW from geothermal
KenGen's successful bond issuance from September 2009 will enable it to generate an additional 500MW of electricity from geothermal sources by 2013.
Reported from Kenya, the successful bond offering of KenGen closed in September 2009 and the “additional Ksh10 billion ($133 million) through a greenshoe option — a provision that allows an issuer to scale up an offer in the event of higher-than-expected demand.” will enable it to generate an additional 500MW of electricity from geothermal sources by 2013, or just four years’ time.
When it comes online, the new KenGen power will probably enable Kenya to retire all of its private fossil-fuel based IPPs, whose electricity is priced according to the prevailing global oil prices.
Currently, consumers are paying a “fuel charge” almost as high as that of their monthly electricity consumption.
Analysts say this is making Kenya an unattractive business destination.
The additional power KenGen wants to inject into the national grid will be nearly a third of the current generation capacity of slightly over 1,300MW.
“In line with Vision 2030 and anticipated increased economic activities, consumption of electricity is expected to continue growing,” KenGen said recently in its end-of-year accounts.
“We plan to increase generation capacity by 500MW by 2013 and another 1500MW by 2018, (with) the focus being on geothermal generation.”
The emphasis on geothermal sources, the power utility says, will help cushion the company and the country against reliance on hydro-electricity, generated mainly from one river basin, the Tana.”
Source: All Africa