Geothermal development in East Africa boosted by AfDB

A new project supported by the African Development Group (AfDB) plans to exploit the geothermal potential in the Lake Assal region to enable Djiboutian population\'s access to a reliable, renewable and affordable source of energy. Currently Djibouti relies mostly on fossil fuels and some hydropower imports from Ethiopia. The majority of the country\'s current generation capacity is situated in Djibouti City. The existing power stations are old, polluting and expensive to operate. In addition, fuel imports are expensive and require important foreign-currency expenditure. As a consequence, only half the population of the country has access to electricity due to high tariffs. Djibouti is however blessed with substantial geothermal potential, capable of meeting the country\'s energy needs and possibly exports to neighboring countries, while reduce CO2 emissions from thermal electricity generation. The geothermal exploration project in the Lake Assal region is structured as Public Private Partnership, where the government of Djibouti is taking the lead on the first exploration and appraisal drilling phase. The private sector will be responsible for the production drilling, steam gathering system and electricity production and evacuation to the national grid, a bank press release said. In collaboration with the World Bank, the African Development Bank Group has structured the financing of this project. The first phase will cost approximately US$ 32 million. The AfDB Board approved a USD 7.5 million financing from the African Development Fund and the Sustainable Energy Fund for Africa (SEFA), a Danish funded initiative implemented by the AfDB. Drawing from the Menengai experience and tapping into the East African Rift valley geothermal potential; the AfDB has also been working on a series of small-scale geothermal units, adapted to the specific context of each country. In Ethiopia, the AfDB is playing a leading role in defining a geothermal roadmap. In Tanzania, it is leading the Scaling Up Renewable Energy Program which includes the financing of a geothermal development project. In the Comoros, the AfDB is also working to develop a 20 MW geothermal plant matching the needs of the archipelago.