The Geothermal Development Company (GDC) has signed a 20-year deal to supply a cement manufacturing company with steam for use in running its operations.
GDC and Karsan Ramji & Sons Limited, manufacturers of Ndovu Cement, inked the deal on Tuesday.
According to GDC Chief Executive Officer Paul Ngugi, the deal marks a significant milestone in the history of energy, especially geothermal.
Ngugi noted that the direct use of geothermal energy is a versatile area that has well been demonstrated in the Menengai steam wells.
At Menengai, Ngugi said there is direct-use projects in heating greenhouses and aqua ponds, milk pasteurisation, and even in drying of cereals.
"We are happy that Karsan Ramji found it fit to become part of the geothermal community. The investment they are going to make in this project is a vote of confidence in geothermal energy as a base-load, its affordability, and its green credentials.
"This model is the future of geothermal. We are optimistic that more investors will find value by emulating this approach," said Ngugi.
GDC will supply the cement maker with around 40 tonnes per hour of geothermal steam.
Karsan Ramji & Sons Ltd started operations in 1977, initially as a civil infrastructure company before moving into aggregate mining. Since then, the company has expanded its mining operations to Nakuru.
It was noted that the use of steam from Menengai in cement manufacturing will lower the cost of production by about 30 percent.
"As part of our market expansion strategy, we plan to construct our second cement grinding plant in Nakuru that will also have a separate raw material drying plant," said Kishor Varsani, the CEO of Karsan Ramji & Sons Limited.
The cement plant will enhance product accessibility for its customers in both Western and Northern Kenya.
The factory will have a capacity of producing between 600 and 800 tonnes of cement per day and will directly employ approximately 120 people and over 1,500 indirectly.
Varsani said at Ndovu Cement, they have a strong commitment to the environment, and in 2021 made a strategic decision to gradually wean off fossil fuel and embrace renewable forms of energy in their operations.
"Our target is to have 100 percent of the energy requirements in all of our facilities being met by renewable energy sources by the year 2040. It is in this spirit that we have chosen to partner with GDC for our energy requirements," he said.
The agreement will see GDC supply Ndovu Cement with steam and brine.
At the same time, Ndovu Cement, on the other hand, shall install a wellhead generation unit that has a capacity of 4mw to power the cement factory and a drying unit that has a capacity of 700 tonnes per day for the purposes of preheating some of the cement production components.