UNEP/GEF African Rift Geothermal Development Facility (ARGeo)

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Kenya's Olkaria geothermal power plant reduces power imports by 52%

Kenya’s Olkaria geothermal power plant reduces power imports by 52%

The Issue
Accessible, affordable and reliable energy resource is a driver for socio economic development. However, Africa continues to face challenges related to its energy sector mainly due to lack of access to modern energy services (rural areas), poor infrastructure, low purchasing, low investment and over dependence on biomass to meet basic energy needs.
African countries that are located along the East African Rift System (EARS) have the largest hydroelectric and geothermal potentials of the continent. EARS is one of the major tectonic structures of the earth where the heat energy of the interior of the earth escapes to the surface. This heat energy flow takes place in the form of volcanic eruptions, earthquakes and the upward transport of heat by hot springs and natural vapor emissions. The EARS extends for about 6500 km from the Middle East (Dead Sea-Jordan Valley) in the North to Mozambique in the South. The EARS passes through Eritrea, Djibouti, Ethiopia, Kenya, Tanzania, Uganda, Rwanda, the Democratic Republic of Congo (DRC), Zambia, Malawi, Mozambique and Madagascar.  Estimated Geothermal energy resource potential in the EARS is more than 20,000 MWe. Geothermal energy stands out as a least cost renewable energy base-load to complement intermittent renewable power production (e.g. hydro, wind, solar) in the region.

ARGeo is a GEF funded project that aims at supporting Eastern African countries to fast track the development of huge and untapped geothermal resources for power generation and direct use application. This project targets six countries including Eritrea, Ethiopia, Kenya, Rwanda, Tanzania and Uganda. ARGeo is designed to catalyze investments and encourage public and private developers by identifying the resource and mitigate the risk associated with resource exploration.
The $4.75 million GEF-funded Project provides technical and financial support to enable governments to generate the scientific, technical and economic information for selected geothermal energy prospect areas, and to develop scientifically sound geothermal development project proposals. It also supports regional networking and information sharing; contributes to the development of national policies and legislations as well as institutional and regulatory frameworks; and promotes financial instruments to reduce investment risks and facilitate both public and private investments in geothermal energy development. UNEP ARGeo program created an operational linkage with the AUC-KfW Geothermal Risk Mitigation Facility (GRMF) and AUC Regional Geothermal Programme.

The project has:

• Created the right institutions to attract investment and momentum to fast track geothermal development in the region
• Led to the creation of a new Tanzanian Geothermal Development Company and Geothermal Development Survey in Uganda
• Spurred the interest of public and private entities in harnessing the huge geothermal potential in Ethiopia for example the recently signed agreement between the Ethiopian Government and the Private developer Reykjavik Geothermal for the development of up to 1,000 MW in Corbetti with USD 4BN investment
• Developed two project pipelines for Silali (Kenya) and Tendaho (Ethiopia) to be handed over to the AUC-KfW GRMF and other investors/developers
• Created a platform for regional networking and provided geothermal related information with linkage of focal points from 13 East African countries through the African Geothermal Inventory Database (AGID) and websites that attract investment

Two additional projects from Eritrea (Alid) and Kibiro (Uganda) have been selected and are to start implementation of surface studies.
When implemented, the project expects to realize 500MW of additional geothermal energy in the region, resulting in 46.2 million tons of CO² emission savings over 20 years.

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