In the agreements, Akiira Geothermal Limited will develop and sell 70 MW from its Kajiado- based geothermal facility to Kenya Power at a unit cost of US cents 9.23 per kilowatt hour, in a project expected to be complete by December 2016.
On the other hand Kleen Energy Limited will sell 6 MW of hydropower from its mini hydro plant in Embu at US cents 9.20, to be done by August 2016.
Kenya Power CEO Ben Chumo said completion of these generation projects is crucial as part of the country’s strategy of diversifying the 5,000 MW additional generation capacity to ensure adequate power for the growing economy as well as reduce the overall cost of electricity.
“The PPAs provide stakeholders of Akiira Geothermal Limited and Kleen Energy Limited the off take certainty needed to advance their respective projects as well as provide Kenya Power with an important addition to our generation planning.”
Chumo said the contribution of the two companies to the national grid is notable and is planned to increase in future thus complementing government and KenGen’s investment in the generation expansion.
“These partnerships and generation projects are crucial towards meeting our goal to reach 70 percent connectivity by 2017 and universal access by 2020,” Chumo added.
Akiira Geothermal Limited will also construct a 220 kV transmission line to interconnect the plant with the proposed Suswa substation currently being developed by Kenya Electricity Transmission Company Limited (KETRACO).
Kenya Power recently signed a PPA with Kipeto Power Limited, another Kajiado- based plant, for 100MW wind energy which is expected in the grid in 24 months.
Renewable energy which includes hydro and geothermal currently forms the bulk of the country’s energy mix.
Kenya’s current installed generation capacity stands at 2,298 MW with geothermal providing 46.4 percent, hydro 38.1 percent, thermal 14.8 percent and wind 0.4 perent.
In the medium, Kenya Power expects renewable energy sources coming into the grid to displace the expensive thermal power.