In Naivasha, about 90km north-west of Kenya’s capital Nairobi, stands one of Africa’s first grid-connected biogas plants. Commissioned earlier this year, the US$6.5m Gorge Farm Energy Park biogas plant generates 2.2MW from organic crop waste sourced from a neighbouring 800ha farm, owned by VP Group, one of East Africa’s biggest exporters of fresh vegetables.
In coming months a 10MW grid-connected solar PV plant will be added onto the power facility. The biogas project is expected to have an almost six-year payback period from a combination of grid sales and supply to the neighbouring vegetable farm. The farm will also receive 35,000 tonnes of nitrogen-rich matter as a by-product from the biogas process, for use as fertiliser.
Making money while making a difference
It all started when one of VP’s directors, James Cartwright, met Mike Mason, an energy expert leading a research programme at Oxford University developing new anaerobic digestion technology. They first developed the concept and then brought shareholders together to set up Tropical Power Energy Group – an engineering, procurement and construction company that built the Naivasha biogas plant.
Anaerobic digestion is a natural process in which bacteria break down organic matter in an oxygen-free environment to form biogas.
“They saw a great opportunity to take technology in Europe and develop it across the continent because there is not a big biogas sector in Africa,” says Johnnie McMillan, managing director of Tropical Power.
The opportunity for Kenya to “produce electricity from biogas is huge”, McMillan explains, due to the country’s big agricultural industry and the presence of many large scale farms. According to Tropical Power’s calculations, if organic waste from just 1% of Kenya’s landmass was deployed in biogas plants, it would produce the equivalent of the country’s entire grid connected electricity capacity.
At its farm in Naivasha, VP Group generates thousands of tonnes in waste every year. About 50,000 tons of this organic waste will be supplied annually to Gorge Farm Energy.
“Our investors are passionate because this is clean technology and it fits with an agricultural operation. The shareholders want to make a difference to the planet and when you find a technology that can make money and can contribute to the green revolution across the world, then that’s a feel good factor for investors. In a nutshell, they can make money and make a difference,” says McMillan.
In Africa there are small-scale biogas projects but McMillan says investment into large scale grid connected plants haven’t picked up due to limited understanding of the technology amongst would-be investors, and unfavourable tariff rates offered by utilities.
Expansion into rest of continent
Tropical Power is eyeing opportunities to work with other feedstock partners in developing more projects across the continent. By 2018, the company plans to have built renewable power assets across Africa producing over 130MW.
In Ghana, it is already preparing for the construction of the biogas and solar Kpong Farm Energy Park. The project will rely on waste sourced from the 1,000ha Kpong Farm – owned by VP Group – located at the south-east corner of Lake Volta.
“Our real focus is establishing a platform for growth across Africa,” says McMillan.
Tropical Power’s expansion into other countries will be guided by stability of the local power utility. In Kenya, transmission, distribution and retail of electricity is handled by state-run Kenya Power, while in Ghana it is controlled by Electricity Company of Ghana.
“One of the big attractions for Kenya is that Kenya Power is a very strong utility. It has a very strong track record of payment and so it is attractive from a point of view of raising money. The number one thing lenders look at is how safe the utility is [in terms of payment] if you are doing a grid-connected project.”
The growth of biogas energy in Africa is also reliant on the availability of good talent. Tropical Power’s operations are headed by Mike Nolan, an energy expert who has built 56 power plants in 22 African countries, installing a total of over 1GW of diesel-generated electricity. The company sent its engineering team to Europe to be trained by its partners – US multinational General Electric and Germany-based Snow Leopard Projects GmbH.
“We want to lead the biogas sector development in East Africa and across Africa. So we are investing in our team to make them experts, [and eventually] the plant in Naivasha will become a centre of excellence for Kenya and for the biogas sector in general,” says McMillan.