The African Development Bank is pushing forward on helping the development of geothermal energy projects in East Africa through special financing to take on the key risk of development, drilling.
The African Development is looking at pushing geothermal development in East Africa even further.
With the experience of its work in Kenya so far, the African Development Bank is establishing an ambitious geothermal development program for East Africa.
The bank is currently working with the government of Djibouti on the development of a 50 MW geothermal power project in the Lac Assal region. In Ethiopia, AfDB has helped develop a geothermal development roadmap. In Tanzania the bank is in the lead of a scaling program for renewable energy. Even in the Comoros, an identification process for a potential 20 MW geothermal project has been supporeted by the AfDB.
Now a new model has emerged to fast track the development in the East African Rift Valley. Financing early stage and high-risk activities mainly as it relates to drilling, concessional financing has been made available.
As part of the model special purpose companies are founded and financed, which take on drilling and taking most of the drilling risk. With drilling than successful, private investors can step into the projects and develop geothermal power plants.
Source: African Development Bank