The Development Bank of Southern Africa (DBSA) has announced an investment of $68 million to improve a 35-megawatt geothermal power plant in Kenya to boost clean energy production.
The DBSA signed the financing deal with Sosian Energy, a private-owned Indigenous energy company in Kenya, to boost the country’s electricity supply.
Mohan Vivekanandan, group executive for Origination Coverage at the DBSA, said the Bank will be providing $68 million over 12 years, meaning a 12-year repayment period to support the transaction.
He said: “We’re proud to have signed a loan agreement with Sosian Energy of Kenya for the Sosian-Menenga geothermal project. It’s a 35-megawatt project in the Rift Valley in Kenya, and the DBSA will be providing the entire amount of the debt for the transaction. The funds should flow through this year.
“There are just one or two more specific items to be met and all of the funds will go towards this project, which is a renewable geothermal energy project based in Kenya, which will feed energy into the grid to support Kenya’s industrialisation, to promote economic growth, and to promote social progress in the country.”
The DBSA is a government-owned development finance institution, established in 1983, with the mandate to promote economic growth as well as regional integration for sustainable development projects and programmes across the African continent.
“We’ve managed to complete our construction and this fund will be used to pay off the contractors who have already funded the construction of the power plants,” said Kigen Moi, MD of Sosian Energy.
According to him, Sosian Energy is the first African-owned company that is being financed by an entirely African-owned development bank in geothermal space in the world. “It has never happened before. It’s the first of its kind.”
Sosian Energy’s 35-MW geothermal power plant in the Menengai geothermal field, Kenya, began supplying electricity to the national grid in November 2023, according to the Moi. The plant is the first of three planned power stations in Menengai, which will collectively provide a capacity of 105 MW.
Sosian Energy, operating through Sosian Menengai Geothermal Power Ltd. (SMGPL), is one of the three Independent Power Producers (IPPs) granted the rights to build and manage geothermal power plants in Menengai, Kenya.
