Kenya’s Geothermal Ascent: The ‘Iceland of Africa’ Powers a Green Industrial Revolution
By Germán Toro Ghío, Strategic Energy Consulting, Karlstad, Sweden, 9 August 2025
#RutoEnergyForKenyaTransformation
In the volcanic expanse of Kenya’s Great Rift Valley, where the earth breathes with the pulse of an ancient force, steam rises from deep within the earth. The land itself, a vivid canvas of raw, untamed beauty, hums with the energy of the ages, its power harnessed by turbines that sing the promise of a future born from nature’s heart. The Olkaria geothermal complex, a monument to human ingenuity and the planet’s eternal vitality, stands as a beacon of Africa’s renewable revolution. Here, amid the rugged beauty of this vast expanse, Kenya has achieved what many thought impossible: 90% of its electricity now flows from the clean, unyielding veins of nature.
But Kenya’s story is not only one of geothermal might—it is the story of a nation awakening to the boundless potential of its land and skies. The sun, casting its unrelenting rays across the plains, becomes both the promise and the engine of a new era. Beneath its brilliance, Kenya is transforming into the beating heart of Africa’s solar revolution. This land, kissed by the sun’s eternal glow, has become the promised land for solar farmers, a radiant utopia where fields of solar panels bloom like crops of light, fertile with possibility.
In the embrace of Kenya’s vibrant landscapes—from the rolling savannas to the rugged highlands—the nation is laying the foundation for Africa’s clean energy future. No longer defined by its dependency on fossil fuels, Kenya is rewriting the energy narrative, drawing from the raw forces of the earth and sky. The once distant dream of a sustainable, cleaner tomorrow is now a vivid, living reality. Kenya stands as the shining example of a nation in full bloom, where nature’s energy is harnessed not only for today but also as the guiding light toward a brighter, cleaner future. The country has become the crucible for a revolution—one of hope, resilience, and the promise of an Africa empowered by the brilliance of its sun.
The Geothermal Backbone
With 727 MW of installed geothermal capacity (7th globally), Kenya has exploited its tectonic advantage to develop Africa’s most resilient grid:
- 10,000 MW untapped potential in the Rift Valley—enough to power five Kenyas.
- Baseload costs of $0.07/kWh—less than half the price of diesel generation.
- State-owned KenGen (NSE: KEGN) produces 75% of the national power while attracting private capital through a hybrid ownership model.
“Geothermal isn’t intermittent. It provides 24/7 stability that makes solar integration economical,” says Rebecca Miano, KenGen CEO. “We’ve drilled 300+ wells domestically—no longer reliant on foreign expertise.”
#RutoEnergyForKenyaTransformation
Policy Catalyst: Ruto’s Green Industrial Vision
President William Ruto has positioned energy as the engine of Kenya’s economic transformation:
- 2024 Energy Reforms: Shattered transmission/distribution monopolies (KPLC/KETRACO), enabling private power sales.
- U.S. Partnership: Climate and Clean Energy Industrial Deal (May 2024) unlocking technology transfer.
- COP28 Commitment: Triple renewable capacity by 2030.
“Africa’s resources can catalyze green industrialization,” Ruto declared during his Washington visit. “We’re building export pathways to Ethiopia, Tanzania, and beyond.”
While geothermal anchors the grid, solar is scaling rapidly:
The Malindi Solar project, with a capacity of 40 MW, is operational and features a grid-synced system with geothermal backup. The Radiant Eldoret project, expected to achieve COD in 2025, offers 50 MW and is notable as the first private PPA following monopoly reforms. The Garissa Plant, currently expanding to 55 MW, operates as a UNDP-funded community hybrid model.
“We pay $0 for fuel and $22/MWh for solar—geothermal handles night peaks,” explains EPRA Director-General Daniel Kiptoo. “That’s why our industrial tariffs beat South Africa’s.”
Investment Landscape
Opportunities
- Geothermal Expansion: $4bn needed to reach 3,000 MW by 2030 (JICA, AfDB co-funding).
- Green Hydrogen: KenGen is piloting 5 MW electrolysis at Olkaria.
- Regional Exports: 200 MW Ethiopia link (2026), Oman undersea cable study.
Hurdles
- CAPEX Disparity: Solar costs $869,000/MW (3× European prices).
- Currency Risk: 82% of PPAs are USD-denominated (shilling volatility).
- Grid Constraints: 23% transmission losses in Northern corridors.
The Replicable Model
Kenya’s blueprint—prioritise baseload renewables before scaling variables**—is gaining continental traction:
- Ethiopia: Accelerating Corbetti geothermal (75 MW phase).
- Tanzania: Ngozi geothermal tender (Q1 2026).
- Rwanda: Lake Kivu methane-solar hybrids.
“Countries without oil are leapfrogging to geothermal-solar synergy,” notes IEA Africa Director Fatih Birol. “Kenya proves it’s bankable.”
Market Projections
The key targets for 2030 compared to 2025. Geothermal capacity is set to increase from 950 MW to 3,000 MW, while solar additions are projected to grow from 120 MW to 852 MW. Green hydrogen output aims to progress from the pilot phase to 500,000 tons per year. Additionally, the industrial tariff is expected to decrease from $0.10/kWh to $0.07/kWh.
Investor Takeaways
1. Play the Baseload: Geothermal offers 25-year PPAs with sovereign backing.
2. Hybrid Advantage: Solar + geothermal requires minimal storage CAPEX.
3. Follow Reform Momentum: Open access market cuts offtake risk.
4. Watch Currency Hedges: Partial local-currency PPAs emerging (e.g., Radiant Eldoret).
“Kenya isn’t just African Iceland—it’s a test lab for the Global South’s energy transition,” concludes James Mwangi, CEO of Equity Group. “The returns? As solid as the Rift Valley’s bedrock.”
Germán Toro Ghío leads Karlstad-based Germán Toro Ghío Strategic Energy Consulting, advising on African energy transitions.
Sources: EPRA, KenGen, IEA, AfDB, project developers.
© 2025 Germán Toro Ghío. All rights reserved.