KenGen secures $77 million for its first grid-scale batteries

Overview

Updated 1 hour ago

Kenya's state-owned power producer has a $77 million package to build its first utility-scale batteries. KenGen will install a 100-megawatt storage network at four sites: Olkaria in Naivasha, Kipevu in Mombasa, Embakasi in Nairobi and Muhoroni in Kisumu.

The money comes from the Green Climate Fund ($45 million, about Sh5.84 billion) and the World Bank's International Development Association (32.08 million euros, about Sh4.65 billion), under a programme called the Kenya Green and Resilient Expansion of Energy. The first phase is designed for up to 200 megawatt-hours. A World Bank-backed technical study found Kenya needs 400 megawatts of one-hour storage immediately.

Why it matters

Kenya vents enough geothermal steam each day to power a mid-sized city. Storage is how that surplus gets sold at peak instead of wasted.

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Key Indicators

$77M

Total battery storage financing

Green Climate Fund and World Bank concessional lending combined, about Sh10.5 billion.

100 MW

Planned battery capacity

Distributed across four substations and generation hubs.

200 MWh

First-phase energy capacity

The initial build is sized for load shifting, not multi-hour storage.

400 MW

Storage the grid needs now

Figure from the World Bank-supported technical assessment of one-hour battery capacity.

16%

Installed geothermal capacity vented daily

Up to 170 megawatts of steam released unused because off-peak demand is too low.

Sites selected

Olkaria, Kipevu, Embakasi and Muhoroni, owned by KenGen, KETRACO and Kenya Power.

Voices

Curated perspectives — historical figures and your fellow readers.

People Involved

Peter Njenga

Managing Director and Chief Executive Officer, KenGen

Leading the battery storage build-out

Organizations Involved

Kenya Electricity Generating Company (KenGen)

State-owned power producer

Implementing agency for the battery storage component

Kenya's dominant generator, and the agency responsible for building the country's first grid-scale batteries.

Green Climate Fund

Multilateral climate finance fund

Providing $45 million for the storage component

The United Nations-backed fund supplying the largest single share of the battery financing.

World Bank International Development Association

Concessional lending arm of the World Bank

Providing about 32 million euros for the storage component

The World Bank's soft-loan window, funding most of the wider energy programme.

Kenya Electricity Transmission Company (KETRACO)

State transmission utility

Owns one of the four proposed battery sites

The grid builder that will host part of the storage network and sign ancillary service agreements.

Timeline

November 2023 November 2026

6 events Latest: Today

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November 2026
Financing and four battery sites disclosed
Today Financing

KenGen's funding split and the Olkaria, Kipevu, Embakasi and Muhoroni locations were reported.
Today
March 2026
Feasibility study runs behind schedule
Review

A World Bank mission found the environmental assessment needed a contract extension and urged faster procurement.
March 2026
July 2025
Pilot battery powers KenGen data centre
Deployment

A 1.16 megawatt-hour battery began backing the company's 52-kilowatt modular data centre in Nairobi.
July 2025
March 2024
Financing agreements signed
Financing

Kenya and the two lenders signed the agreements; the programme became effective in January 2025.
March 14th, 2024
December 2023
World Bank board approves $202 million programme
Financing

The package combined $153 million from the International Development Association with $48.5 million from the Green Climate Fund.
December 26th, 2023
November 2023
KenGen named battery implementing agency
Appointment

The World Bank tasked KenGen with building storage under the Kenya GREEN programme, pending a feasibility study.
November 24th, 2023

Scenarios

KenGen signs the first battery contract and starts commissioning

Possible Resolves by End of 2027

Discussed by: World Bank implementation mission reports and KenGen's feasibility-study timeline

The feasibility study closes out siting, sizing and environmental assessment, supervision consultants prepare bidding documents, and an engineering, procurement and construction contract is awarded. Installation then begins at Olkaria or Embakasi first, with commissioning before the programme's June 2029 closing date.

Procurement slips past the 2029 closing date

Possible Resolves by Q2 2029

Discussed by: World Bank mission notes on the delayed environmental assessment and slow disbursement

The programme had disbursed about 1 percent of its total by March 2026. Contract extensions for the environmental and social assessment, plus unresolved commercial terms between KenGen, Kenya Power and KETRACO, push construction past the June 2029 closing date, leaving the loan partly unspent.

Private developers fund the remaining 300 megawatts

Unlikely Resolves by End of 2029

Discussed by: World Bank programme documents on tolling models and private capital mobilisation

The first battery runs under a tolling arrangement, establishing purchase and ancillary service agreements. Those contracts give lenders and developers a template, and Kenya's Mission 300 energy compact target of 400 megawatts gets filled by independent power producers rather than state borrowing.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

September-December 2017

Hornsdale Power Reserve (2017)

South Australia installed a 100-megawatt lithium-ion battery next to a wind farm after a statewide blackout. Tesla built it in about 100 days under a state government contract.

Then

The battery cut the cost of frequency control services sharply within months of switching on.

Now

It became the reference case showing grid-scale batteries could replace gas peaking plants, and prompted a wave of similar projects.

Why this matters now

Kenya's 100-megawatt plan is roughly the same size, and faces the same question: whether batteries beat gas turbines on cost for peak supply.

1981-2015

Olkaria geothermal development (1981 onward)

Kenya commissioned Olkaria I, the first geothermal power station in Africa, in the Rift Valley near Naivasha. Successive expansions made geothermal the country's largest electricity source.

Then

Geothermal gave Kenya cheap baseload power that did not move with oil prices.

Now

The plants run continuously, so night-time surplus became a structural problem rather than an occasional one.

Why this matters now

Olkaria is both the source of the curtailed steam and one of the four battery sites. Storage exists to fix a problem geothermal created.