AKIIRA I GEOTHERMAL POWER PLANT (EIB-20140645)

Regions
  • Africa
Where the impacts of the investment may be experienced.
Countries
  • Kenya
Where the impacts of the investment may be experienced.
Specific Location
Naivasha, Nakuru County
Whenever identified, the area within countries where the impacts of the investment may be experienced. Exact locations of projects may not be identified fully or at all in project documents. Please review updated project documents and community-led assessments.
Financial Institutions
  • European Investment Bank (EIB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Bank Risk Rating
U
Risk rating varies among banks and may refer only to the particular investment and not to the risk for the project as a whole. Projects marked 'U' have an 'Unknown' risk rating at the time of disclosure.
Borrower
Akiira Geothermal Limited
The holder of the loan, grant, or other investment.
Sectors
  • Construction
  • Energy
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, etc.
Investment Amount (USD)
$ 192.00 million
Value listed on project documents at time of disclosure. If necessary, converted to USD$. Please review updated project documents for more information.
Currency conversion note:
Bank reported 155 Euros
Converted using 2016-01-12 exchange rate.
Project Cost (USD)
$ 380.00 million
Value listed on project documents at time of disclosure. If necessary, converted to USD$. Please see updated project documentation for more information.
Currency conversion note:
Bank reported Euro 310
Converted using 2016-01-12 exchange rate.
Bank Documents
Primary Source

Original disclosure @ EIB website

Updated in EWS Oct 8, 2018

Disclosed by Bank Jan 12, 2016


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Project Description

The project involves construction of a 70MWe geothermal power plant as an independent power producer (IPP) located outside Naivasha, Kenya, adjacent to the Olkaria geothermal production site. The project is the first phase of a planned 140MWe geothermal development in the Akiira geothermal area.

The project will provide renewable energy to bridge the existing demand gap between potential demand and supply in Kenya. The proposed operation is in line with the strategic objectives set for the external mandates in general (environmental sustainability, climate change mitigation) and the Cotonou Agreement, in particular Article 21 concerning investment and private sector development. The operation will also contribute to the Bank's priority energy lending objectives related to renewable energy. In addition, the 11th European Development Fund (EDF) National Indicative Programme for Kenya (2014-2020) foresees a focus on sustainable infrastructure. Indeed, the project will contribute to poverty reduction (sustainable development goal (SDG) 1) and to inclusive economic growth (SDG 8) by improving access to affordable, reliable, sustainable and modern energy services (SDG 7). It will also contribute towards combatting climate change (SDG 13). Further, the project is fully in line with the country's objectives in Kenya's Second Medium-Term Plan (2013-2017), aimed at implementing Kenya's Vision 2030; it explicitly targets increasing the share of power generated from green sources.

 

Investment Description
  • European Investment Bank (EIB)

The European Investment Bank (EIB) has indicated that it’s preparing a €155 million ($192 million) loan package for the 70MW Akiira Geothermal Project in Naivasha, in Nakuru County, Kenya. The Akiira project has an estimated project cost of EUR 310 million ($380 million) and is being financed through a mix of debt (70%) and equity (30%), according to the executives. Centum Investments owns a 37.5% equity stake in the Akiira consortium, with the remaining 62.5% owned by American firms Ram Energy, Marine Power, and Danish company, Frontier Markets.The Centum consortium is expected to contribute 30% of the project’s cost of $380 million while the rest will be funded through commercial loans.

Private Actors

Marine Power Generation (MPG) are the holders of the geothermal exploration license and have shares in AGL. Ram Energy is the company with technical expertise in geothermal development and also have a stake in AGL. The two main financial investors are Mvuke Power Limited (wholly owned by Centum Investments Company Ltd – CICL) and Frontier Akiira Holding Company Ltd. (owned by Frontier Investments).

Centum Investments owns a 37.5% equity stake in the Akiira consortium, with the remaining 62.5% owned by American firms Ram Energy, Marine Power, and Danish company, Frontier Markets.The Centum consortium is expected to contribute 30% of the project’s cost of $380 million while the rest will be funded through commercial loans.

Contact Information

*Contact information not provided at the time of disclosure*

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