Turkana wind Power project to reap from carbon sale

Last Updated 16 years ago by Kenya Engineer

The planned 300 megawatts wind power project in Turkana, northern Kenya, will earn up to 14 million euros (Sh1.3 billion) in carbon credit sales a year, the initiative’s debt arranger said in a recent press briefing, raising hope for improvement of the livelihood of communities living around the site.“The community around Turkana has been marginalized for a long time and the project promises a windfall in terms of proceeds from carbon credit sales that would be used to improve development in the region,” Bobby Pittman, the African Development Bank (AfDB) vice President for Infrastructure, Private Sector and Regional Integration affirmed in an interview.

“The earnings could even be more than projected because the demand for clean energy is huge.” The AfDB estimates that during the project’s 20-year lifespan carbon emissions will be reduced by an estimated 16 million tonnes indicating the potential earnings the project is likely to generate from the facility. The bank is facilitating a debt tranche for the Sh55 billion wind power project that could add up to a third of power supply to the national grid.

The project is the brainchild of private investors under the umbrella of Lake Turkana Wind Power (LTWP) group. The LTWP envisaged constructing a wind farm consisting of 353 wind turbines, each with a capacity of 850 kilo watts (kW). The total power generated in the initial phase of the project is expected to reach 300mw by July 2012. LTWP already has an agreement with Danish firm Vestas Wind
to supply 360 wind turbines for use in the project.

“The excitement is huge among lenders and we are sure of securing the needed funds. Everyone wants to be part of this historic environmentally friendly power project,” Mr Pittman said in an interview on the sidelines of the bank’s annual conference in Abijan. The undertaking is among those that have won grants from a new UN-backed facility that aims to boost the African carbon market through environmentally friendly projects. Alongside Athi River Mining Limited (ARM), they are among beneficiaries of the African Carbon Asset Development facility (ACAD) set up as a collaboration between the United Nations Environment Programme (UNEP), Standard Bank and the German government’s International Climate Initiative.

The work plan of the ACAD showed it would support African carbon projects through a combination of technical assistance, grants and preferential access to corporate finance and transactional guidance. “Government investment alone will not be enough. ACAD is a good example of how we can attract much-needed private capital for investments that address climate change.” Another Kenyan firm, Mumias Sugar Company, has also ventured into the carbon credits trade in which it produces power through burning of bagasse.