GDC, Karsan Ramji seal agreement On Geothermal power

Nov 29, 2023 - 16:58

Geothermal Development Company (GDC) Managing Director Mr Paul Ngugi (Left) and Chief Executive Officer of Karsan and Ramji Sons Limited Mr Kishor Varsani (Right) display copies of a signed agreement between the two parties to supply the later with steam and brine to power its operations. (Picture/Dennis Rasto).

Nakuru

Wednesday November 29, 2023

KNA by Jane Ngugi and Dennis Rasto

Geothermal Development Company (GDC) will heavily expand its research and innovation on the direct uses of geothermal energy in a bid to support community and national economic development, Managing Director (MD) and Chief Executive Officer (CEO) Mr Paul Ngugi has said.

Mr Ngugi observed that geothermal energy is versatile and prolific adding that apart from its uses in the generation of electricity, geothermal has dozens of other uses such as in heating greenhouses, milk pasteurization, laundry, leisure and recreation, among many other uses.

The Chief Executive Officer noted that GDC was running four pilot projects on heating of fish ponds, and greenhouses and operation of milk pasteurization and laundry industries using direct steam on the floor of the Menengai Crater.

“Geothermal energy is our natural heritage - it’s not imported like oil. It’s abundant in Kenya with a potential of about 10, 000MW. It is clean, reliable, and affordable. We also have vibrant homegrown geothermal expertise, hence the right ingredients to drive a geothermal boom,” stated the Chief Executive Officer.

Speaking in Nakuru after GDC signed a 25-year deal to supply cement manufacturer Karsan Ramji and Sons Limited with steam and brine, Mr Ngugi indicated that the State Corporation was targeting more revenue from its fields on the Menengai Crater floor through the sale of steam to industries that rely on power to fuel their heating process.

In the deal, GDC will provide Karsan Ramji with 40 tons per hour of geothermal steam to be used for power generation and the heat to dry during cement production.

It is estimated that such an arrangement between corporations can dramatically cut the cost of production.

Mr Ngugi stated that this marked a departure from conventional power generation into a promising realm of captive power and thermal heat.

“Indeed, it is refreshing to see new investments made with energy as a key plank. Such investments will not only, in the long run, help to cut the cost of energy, they will make our products and services competitive and attractive. Investment of this nature will create direct and indirect job opportunities that our country so desperately yearns for,” said Mr. Ngugi.

He added “We are happy that Karsan Ramji found it fit to become part of the geothermal community. The investment they are going to make in this project is a vote of confidence on geothermal energy as a baseload, its affordability, and green credentials. This model is the future of geothermal. We are optimistic that more investors will find value by emulating this approach.”

This is the first of this kind of agreement in Kenya where an industrialist is seeking to generate own geothermal power for the manufacturing process.

Mr Ngugi disclosed that apart from being affordable at a cost of Sh 5 per kilowatt, geothermal steam power was friendly to the environment.

“Geothermal generation accounts for 48 percent of power that goes to the national grid. GDC currently yields 35 Megawatts while Kenya Electricity Generating Company (KenGen) owned Olkaria wells in Naivasha pump at least 320 Megawatts to the national grid,” stated the CEO.

He observed that power generated from geothermal sources was the ‘most customer friendly’ at a cost of 7 US cents per kilowatt.

“Tariffs from geothermal are low. They are cushioning the consumer against high bills. To leapfrog into an energy rich country, we must make bold strides,” said Mr Ngugi.

GDC Board Chairman Mr Walter Osebe Nyambati observed that the 25-year-old deal with Karsan Ramji and Sons Ltd, the manufacturers of Ndovu cement will heighten Kenya’s competitiveness as an investment destination adding that, policymakers, investors, academia, and financiers must consider geothermal energy more aggressively.

Mr Nyambati noted that GDC had resorted to pursuit of innovative enterprises to holistically utilize the resource as only 20 percent of heat from steam is used to generate electricity and that 80 percent has been going to waste.

“GDC is designing projects that will utilize part of the 80 percent. We’re adopting technology that will capture and deploy the heat for horticulture farming, leisure and recreation and industrial processes. Today, for instance, we are pasteurizing milk at Menengai using geothermal heat. It’s profitable. Scaled up, investors in the dairy industry have a goldmine. That’s why we’re in an MoU with the county governments of Nakuru and Baringo to establish geothermal resource heat parks,” explained the board chairperson.

He stated that such parks will attract investors in the manufacturing sector angling for affordable and reliable heat. Mr Nyambati affirmed that provision of green energy GDC is helping to decarbonize the economy and open vast new job opportunities.

“Geothermal is one of the jewels in the green energy assemblage. That is why we’re also alive to the realities of SDG 13 that calls for “urgent action to combat climate change and its impacts. Indeed, our medium target of availing 1065 MW by 2030 means that Kenya will escape using 1.8 million tons of heavy oil per year to generate power,” observed the Chairperson.

Mr Nyambati noted that Kenya can save $1 trillion US dollars for not using diesel to generate an equivalent amount of power adding that at 90 percent availability, the 1065MW geothermal power will displace an equivalent of 4. 2 million metric tons of carbon dioxide per year.

“That’s massive. It’s a direct inhibitor of Greenhouse Gases (GHE). By every measure, geothermal energy is the holy grail. It is at the core of green infrastructure architecture,” noted Mr Nyambati.

He went on “With the observed benefits of direct uses, GDC plans to commercialize the technology by inviting investors to use the technology to power processes in their firms or investments. It is for this reason that GDC invites expressions of interest from potential investors.”

Mr Nyambati disclosed that GDC plans to build a wellness spa, geothermal heated public pools as well as secluded high-end spas and cottages that are both heated and cooled by geothermal steam.

"GDC intends to set up a geothermally heated spa-complex in Menengai geothermal field consisting of cold swimming pool, geothermally heated swimming pool with public hot pools, satellite private hot pools, steam heated sauna and baths, therapeutic facility and geothermally heated and cooled cottages within the vicinity of the Spa complex. “said Nyambati.

Geothermal steam is primarily used for electricity generation but can also be used by other industries.

Aside from wellness and hospitality as is the case with geothermal spas, the steam can also be used in dairy processing and greenhouse farming, which GDC plans to do even as the private sector contracted to build power plants continue with electricity generation.

Chief Executive Officer of Karsan and Ramji Sons Limited Mr Kishor Varsani said the Clean and renewable energy transition will accelerate global ambition to achieve net-zero emissions as geothermal power investment led to reliable and sustainable climate smart activities.

Mr Varsani noted that a clean and renewable energy transition will herald nature’s adaptation and sustainable livelihoods.

“Clean smart activities and renewable energy shifts are potential solutions to extreme climate conditions. To address climate change requires a fundamental cultural shift among local communities,” observed Mr Varsani.

He said the firm was putting final touches to establishing a cement manufacturing firm in Nakuru that will exclusively utilize green and renewable sources of energy.

Director of Operations at Karsan and Ramji Sons Limited Dr George Muya said the firm will install a 4-Megawatt power plant in Nakuru that will utilize steam supplied by GDC.

Dr Muya further indicated that the drying process will directly utilize brine supplied by GDC, which he said was in line with the firm’s three-year plan to fully transition to clean and renewable energy.

“Geothermal energy is a reliable form of energy which will allow us to operate at a much higher efficiency which in turn will enhance production. Using steam to run our operations will greatly reduce our operation costs, a benefit that will be passed over to consumers in terms of cheap cement,” said Dr. Muya.

Courtesy; KNA