Toyota Wins Sh13.5bn Deal for Menengai Geothermal Plant

Toyota Tsusho Corp. has signed an engineering, procurement, and construction contract – and long-term service agreement – with UK power producer Globeleq for the construction of a 35MW geothermal power plant in Nakuru County.

According to Globeleq, the signing of the contracts follows the recent approval of major financial agreements with the African Development Bank (AfDB), Eastern and Southern African Trade & Development Bank, and Finnfund.

“Having signed these key project agreements with TTC after achieving a fully committed financing about a month ago, we will now work with the GoK to reach financial close and start construction as soon as possible,” Mike Scholey, Globeleq’s CEO said.

Scholey and Toyota Tsusho’s COO for Africa Division Kazumasa Kimura signed the agreements in Tokyo, Japan, on February 9, 2023.

Steam turbine

Construction of the $108 million (Sh13.5 billion) plant, within the Menengai Crater geothermal fields in Nakuru, is scheduled for completion by September 2025.

Fuji Electric Co. Limited will supply steam turbines and generators.

Steam will be supplied to the power plant by Geothermal Development Company (GDC), a Kenyan state-owned firm under a 25-year project implementation deal.

RELATED: UK Firm Inks Sh9bn Deal for Menengai Geothermal Plant

Globeleq, which will operate and maintain the power plant, is expected to sell electricity to Kenya Power under a power purchase agreement for the same timeframe.

Menengai is Globeleq’s first geothermal project in Kenya.

The company is, however, quite active in the local renewable energy sector.

Together with Africa Energy Development Corporation (AEDC), a renewable energy producer, the firm jointly owns Malindi Solar Group Limited, a special-purpose vehicle company that operates the 40MW Malindi Solar Park in Kilifi.

Strong footprint

On the other hand, Toyota Tsusho has been involved in Kenya since 1962 and, through its fully-owned subsidiary, CFAO, the company has a strong footprint in renewable energy, mobility, healthcare, and infrastructure sectors.

“With our rich experience in the geothermal sector and our local communication network in Kenya, we, together with Globeleq, are excited to contribute to this project toward a stable and affordable supply of electricity in Kenya,” said Richard Bielle, President of CFAO.

In 2021, Globeleq acquired a majority stake in Quantum Power – one of the three IPPs granted rights by the State to build steam-driven power plants on a build-own-operate model.

The first three plants, each producing 35MW, will be built, owned, and run by the IPP along with Sosian Menengai Geothermal Power and OrPower Twenty-Two Company.

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