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The Nairobian

Kenyan firm out of KenGen project

Business

By Macharia Kamau | Oct 31, 2020

A consortium of four companies, one of them Kenyan, has been struck off the list of the firms eyeing the building of a geothermal power plant in partnership with KenGen.

KenGen (above) has been planning a power plant at its geothermal fields at Olkaria through the public-private partnership (PPP) model since last year. In May this year, it published a list of five companies shortlisted and expected to give a detailed pitch after a request for proposals was sent to them.

Yesterday, the power producer published an updated list of four companies. Missing from the shortlist is a consortium of four firms - Engle Energie Service (France), Toyota Tsusho Corporation (Japan), Kyuden International Corporation (Japan) and DL Koisagat Tea Estate (Kenya).

This leaves Ormat Technologies (US), Itochu Corporation (Japan), Sumitomo Corporation (Japan) and Enel Green Power (Italy) in the race to build the power plant with KenGen.

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“Notice is given by KenGen to the general public of the updated prequalification shortlist following the issue of a request for qualifications on November 5, 2019, for the development, operation and maintenance of the 140 MW Olkaria VI Geothermal Public Private Partnership Project,” said KenGen in a public notice.

Other firms that had bid but lost in the early stages are Marubeni Corporation (Japan), Zorlu Enerji (Turkey) and a consortium led by Azura Power Holdings.

KenGen plans to select a company through the tender process and together form a special purpose vehicle (SPV).

This will then build the plant under a build-own-operate-transfer arrangement where ownership will eventually revert to KenGen.

The power producer will have the right to make a cash investment of 25 per cent in the SPV.

The SPV will finance, construct, own and operate the power plant and associated facilities.