Listed power generating company KenGen is set to build a KSh 17bn, 100MW green hydrogen plant, funded through concessional financing from Germany.
The two countries launched a climate and development partnership in 2022 which helps Kenya develop a green hydrogen value chain to locally produce fertilizer. While KenGen will implement the plant, a fertiliser plant will be set up by the private sector.Green hydrogen, also called renewable hydrogen, is generated through electrolysis, using renewable energy.
“Kenya, and Africa at large, has the potential not only to meet our own energy needs but to become a global hub for clean energy exports, industrial decarbonization, and climate-smart development. Green hydrogen, and its derivatives such as green ammonia and methanol, offer us a pathway to unlock this potential.” Cabinet Secretary Energy and Petroleum Opiyo Wandayi said during a two-day Eastern Africa Regional Green Hydrogen Symposium in Nairobi.
In 2022, KenGen issued a request for proposals for a consultant to conduct a feasibility study for the green hydrogen project. In May 2023, while in Kenya on a state visit, the then German chancellor Olaf Scholz laid out the potential of green hydrogen project production at Olkaria. Kenya launched a Green Hydrogen Strategy and Roadmap at the Africa Climate Summit four months later, setting the stage for the development phase.
“It is our strong belief that green hydrogen development in Eastern Africa is about green industrial growth for jobs, local fertilizers for food security, and accelerated renewable energy development. This means driving economic development while also combating climate change,” said Sebastian Groth, Ambassador of Germany to Kenya, said during the ongoing symposium.
“To unlock business cases and create new job opportunities however, a conducive general business environment is also needed, including stable and predictable regulations. Together with our European partners, we are in a dialogue with the Kenyan Government to overcome these challenges,” he added.
Germany will also channel almost KSh 40bn through its development arm KfW, to support Power-to-green hydrogen markets in developing and emerging countries.