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IFC plans Sh6bn Menengai geothermal project loan
Sosian completed its plant and started supplying the electricity to Kenya Power in 2023. Globeleq and OrPower 22 expected to complete their plants and link them to the national grid by June 2026.
The International Finance Corporation (IFC) will provide a $48 million (Sh6.2 billion) loan to partly fund the construction of OrPower 22’s geothermal power plant in Menengai, Nakuru County.
IFC —the private sector lending arm of the World Bank— disclosed the two loan tranches of $30 million (Sh3.87 billion) and $18 million (Sh2.32 billion) for the project whose total cost is $92 million (Sh11.89 billion). Kaishan Group and other lenders will top up the balance.
OrPower 22 is one of the three energy firms that are developing geothermal power plants in Menengai. Each of these plants will have a 35 Megawatts (MW) capacity.
The three are key in boosting the share of clean energy in the national grid, offering Kenya a chance to boost electricity supply at cheap prices.
“The proposed financing package includes, a senior loan of up to $30 million from IFC’s own account, a dollar interest rate swap intermediated by IFC, parallel loan of up to $16.4 million and a senior loan of up to $18 million from IFC acting in its capacity as implementing entity for the Managed Co-lending Portfolio Program (MCPP). The balance is covered by equity from Kaishan," IFC says in disclosures.
Kaishan Group fully bought OrPower 22 two years ago, a move that gave the Chinese firm entry into Kenya’s electricity generation space.
The other two firms developing the geothermal power plants in Menengai are Globeleq of Britain and Sosian Energy, which is linked to the family of the late President Daniel arap Moi.
Sosian completed its plant and started supplying the electricity to Kenya Power in 2023. Globeleq and OrPower 22 expected to complete their plants and link them to the national grid by June 2026.
The three projects are key to boosting Kenya’s electricity supply amid growing reliance on Ethiopia and Uganda to meet the fast-rising demand.
The share of electricity imports in the national grid crossed the 10 percent-mark for the first time in the year ended June 2025 as Kenya deepened its reliance on neighbouring countries to avoid power rationing and blackouts.
Official data shows that electricity imports accounted for 10.6 percent or 1.53 billion kilowatt-hours (kWh) in the year ended June more than double the share of 4.87 percent 644 million kWh two years ago and a paltry one percent in the year to June 2021.
Electricity from Ethiopia accounted for 81 percent of the total imports in the year ended June 2015. Kenya Power has a 25-year Power Purchase Agreement (PPA) with the Ethiopia Electric Power where a kWh is priced at $0.065 (Sh8.44).
Imports in a month hit a historic high of 150.45 million kilowatt-hours (kWh) in August this year, largely driven by a surge in shipments from Uganda.
Kenya Power's imports from Uganda nearly doubled in August to 32.5 million kWh in August this year compared to 18.95 million kWh a month earlier as imports from Ethiopia dipped in the same period.
