NDF - Financing for climate change and development projects

Geothermal Exploration Project in East Africa

7.09.2012

NDF has approved a grant of EUR 5.0 million to assist East Africa Rift Valley States (EARS) countries in completing the exploratory phase of geothermal development

The East Africa Rift Valley States (EARS) covering 13 countries, from Eritrea in the north to Mozambique in the south, all suffer from low access to electricity. The demand for electrical energy in the region is assumed to grow rapidly in the next years and decades as these countries develop. At the same time the geothermal potential in the EARS is considered to be very promising and in parts of the region it is already known and utilized. Subject to the Icelandic International Development Agency's (ICEIDA) positive financing decision, NDF will, together with ICEIDA, support the early stages of geothermal exploration. The project will finance geological, geothermal and structural mapping, chemical analyses of geothermal springs, and geophysical investigations.  The growing energy demand in the assist East Africa Rift Valley States region is putting a lot of stress on the individual countries. Geothermal energy is an abundant, green and cost-effective alternative to fossil fuels. However, geothermal development projects are risky investments and therefore, it is generally hard to find financing for these types of activities, especially for the early stages as the potential has not yet been demonstrated. The Geothermal Exploration Project will help finance these early stages leading up to significant test drilling, thus reducing the initial risks. The World Bank has already indicated their willingness to raise additional support for the next stages, hence the outcome of the exploration activities will most likely lead to further geothermal investments in the EARS countries, increasing their use of renewable energy.

More information
 
C48 Regional Africa: Geothermal Exploration Project