Impact De-risking Geothermal Energy Investment in East Africa

FSD Africa and Parhelion have launched an initiative to attract investment in geothermal energy in Kenya and Ethiopia by addressing high upfront drilling costs and risks. The programme introduces a Geothermal Risk Transfer facility to mitigate the risk of unviable wells and a training programme to build the capacity of local insurers in risk assessment and parametric insurance. Ten leading insurers have participated in the training, with GA Insurance planning to launch a geothermal risk insurance product within one to two years. The initiative aims to increase geothermal production by 500% in Ethiopia and 20% in Kenya, potentially creating 2,600 jobs and providing electricity to 5.25 million people.

• The East African Rift System has an estimated geothermal potential of 20,000MW, with Kenya specifically possessing a potential of 10,000MW.
• Kenya is a global leader in geothermal energy with approximately 950MW of installed capacity, supporting a goal of 100% renewable energy by 2030.
• FSD Africa and Parhelion are implementing a Geothermal Risk Transfer facility to mitigate risks associated with low production and drilling unviable wells, which typically deter development finance institutions.
• A capacity development programme involving Kenbright has trained ten leading insurers, including ICEA LION Group and GA Insurance Limited, in parametric insurance and geothermal underwriting to keep premiums within the local market.
• The programme's projected impacts include a 500% increase in geothermal energy production in Ethiopia and a 20% increase in Kenya, the creation of 2,600 new jobs, and providing electricity access to 5.25 million people.

APA

FSD Africa (n.d.). Impact De-risking Geothermal Energy Investment in East Africa. https://fsdafrica.org/wp-content/uploads/2025/05/FSD-Africa-De-risking-geothermal-nergy-investments-impact-story-04.02.24-1.pdf

Chicago

FSD Africa. Impact De-risking Geothermal Energy Investment in East Africa. n.d. https://fsdafrica.org/wp-content/uploads/2025/05/FSD-Africa-De-risking-geothermal-nergy-investments-impact-story-04.02.24-1.pdf.

Wikipedia

{{cite report |author=FSD Africa |title=Impact De-risking Geothermal Energy Investment in East Africa |url=https://fsdafrica.org/wp-content/uploads/2025/05/FSD-Africa-De-risking-geothermal-nergy-investments-impact-story-04.02.24-1.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{fsdafricandimpact, author = {{FSD Africa}}, title = {{Impact De-risking Geothermal Energy Investment in East Africa}}, institution = {FSD Africa}, url = {https://fsdafrica.org/wp-content/uploads/2025/05/FSD-Africa-De-risking-geothermal-nergy-investments-impact-story-04.02.24-1.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }