Risky business: developing geothermal power in Kenya

The document examines the barriers to expanding geothermal energy in Kenya, noting that while the resource is abundant and central to the country's climate goals, development is slowed by high upfront exploration costs and infrastructure expenses. It highlights political risks such as the financial viability of the offtaker, Kenya Power, and bureaucratic tensions between national and county governments. Socially, the report identifies community opposition due to land relocation and the uneven distribution of benefits, where marginalized local populations bear the environmental and social costs while urban centers and elites receive the energy benefits. It concludes that for geothermal expansion to be sustainable, the government must better mitigate these risks and ensure equitable benefit-sharing.

• Kenya aims for a significant expansion of geothermal capacity, with the Least Cost Power Development Plan 20172037 and third Medium Term Plan (20182022) targeting an increase from 650 MW to approximately 2500 MW over 20 years.
• High upfront costs for 'greenfield' exploration create a significant financial barrier, as a single exploration well can cost over USD 1 million and three are needed to prove a resource.
• The financial viability of the offtaker, Kenya Power, is a primary political risk; slow growth in large commercial consumers has led to surplus power, potentially increasing the cost of borrowing capital for new investments.
• Geothermal development faces social risks from community opposition, particularly regarding land use restrictions and relocation, such as the 2010 relocation for the Olkaria IV plant.
• Environmental risks associated with upscaled geothermal power include the potential for toxic chemical contamination from steam, excessive water withdrawal from local sources, and the disruption of wildlife migratory routes.
• There is a stark imbalance in the distribution of risks and benefits: financial and political gains accrue to the state and private investors, while social and environmental burdens are borne by marginalized local communities.

APA

Johnson, O. W., & Ogeya, M. (2018). Risky business: developing geothermal power in Kenya. Stockholm Environment Institute. https://www.sei.org/wp-content/uploads/2018/10/181025b-gill-johnson-kenya-geothermal-transrisk-db-1810g-1.pdf

Chicago

Johnson, Oliver W., and Mbeo Ogeya. Risky business: developing geothermal power in Kenya. Stockholm Environment Institute, 2018. https://www.sei.org/wp-content/uploads/2018/10/181025b-gill-johnson-kenya-geothermal-transrisk-db-1810g-1.pdf.

Wikipedia

{{cite report |last1=Johnson |first1=Oliver W. |last2=Ogeya |first2=Mbeo |title=Risky business: developing geothermal power in Kenya |publisher=Stockholm Environment Institute |date=October 2018 |url=https://www.sei.org/wp-content/uploads/2018/10/181025b-gill-johnson-kenya-geothermal-transrisk-db-1810g-1.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{johnson2018risky, author = {Johnson, Oliver W. and Ogeya, Mbeo}, title = {{Risky business: developing geothermal power in Kenya}}, institution = {Stockholm Environment Institute}, year = {2018}, month = oct, url = {https://www.sei.org/wp-content/uploads/2018/10/181025b-gill-johnson-kenya-geothermal-transrisk-db-1810g-1.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }