OLKARIA I & IV GEOTHERMAL EXTENSION

Expansion of existing Olkaria I and new Olkaria IV Geothermal power station to increase generation capacity by a further 280 MW (2x70 MW at each of Olkaria I and IV).

The project will help meet growing electricity demand at a competitive cost and with a limited impact on the environment. Its economic benefits include increased power production, improved security of supply (geothermal power is unaffected by annual hydrological conditions), reduced national dependence on imported fossil fuels for electricity production and additional operational flexibility for existing units at two geothermal power plants.

An environmental and social impact assessment (ESIA) has been established for both power stations. The studies comprise public consultation and respective monitoring plans. The studies have been approved and respective licenses issued by NEMA (National Environmental Management Authority).

The Olkaria IV part requires resettlement of several Maasai communities. A Resettlement Action Plan (RAP) has been established, which included the participation of the project affected communities. The execution of the RAP will be implemented according to the WB guidelines.

Kenyan national law, IDA guidelines (which govern the whole Electricity Expansion Project), EU Directives (2004/17 replacing 93/38) and EIB procurement guidelines require an open tendering procedure with adequate publication for works contracts of this type launched by a public sector company. The promoter will follow these rules and envisages among others a publication of the prequalification notice in the OJEU for the main contracts.

These procurement procedures are in line with the Bank’s procurement guidelines, are considered adequate for the project and satisfactory to the Bank.