Addis Ababa, December 13, 2022 (FBC) – The Tulu Moye geothermal project in Ethiopia is set to receive new funding in the form of a $10 million reimbursable grant from the Sustainable Energy Fund for Africa (SEFA).
The grant was approved by the Board of Directors of the African Development Bank Group (AfBD) to support the geothermal project’s drilling program, according to the report by ThinkGeoEnergy.
The SEFA grant will complement the existing risk mitigation facilities that have previously applied to the Tulu Moye project.
In 2020, the project received a $1.55 million funding from the U.S. International Development Finance Corporation (DFC) and another $9.9 million co-financing grant from the Geothermal Risk Mitigation Facility (GRMF).
Through this funding, SEFA hopes to encourage other private developers to invest on geothermal projects in Eastern Africa.
The Tulu Moye geothermal project, by Tulu Moye Geothermal Operations (TMGO), has an estimated total capacity of 150 MW. It will be developed in two phases (Phase 1 – 50 MW, Phase 2 – 100 MW).
ThinkGeoEnergy’s report indicates that electricity generated in the Tulu Moye geothermal power plant will be fed to the Ethiopian Electric Power (EEP) according to a PPA signed back in 2020.
TMGO is owned by multinational corporation, Meridiam, and Iceland-based Reykjavik Geothermal.
Two drilling contractors have been signed on by TMGO – KenGen in 2019, and the Marriott Drilling Group in 2022. Several wells have already been drilled for the project.
On completion, it will be the first large-scale private sector-driven geothermal development and the first Independent Power Producer in Ethiopia.
“It is essential to be financially supported during the risky drilling period by a key institution. SEFA is a unique solution to unlock geothermal potential in Africa.
Not so many can do it! Thank you to the SEFA/African Development Bank team,” commented TMGO CEO Maxence Mirabeau.
“SEFA will play a critical role in supporting geothermal resource assessment and development, which is the riskiest phase of the project, and catalyze investments in the first private power plant in Ethiopia, paving the way for more public-private partnerships in the country’s energy sector.” said SEFA Manager João Duarte Cunha.