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Kenya’s first Carbon Credits from Geothermal Energy Pay for Schools

Patricia Marcos Huidobro's picture

Kids at the Oloirowua Primary School in Suswa, Kenya.

Last month, I drove through dust on bumpy dirt roads from Nairobi to visit the Oloirowua Primary School in Suswa, 140 kilometers northeast of the Kenya capital. The school sits on the vast savannah near Hell’s Gate National Park, an area with substantial geothermal potential.

Here, KenGen, Kenya’s electric generating company, has built the country’s largest geothermal plant with support from the World Bank. It’s part of the utility’s effort to “green the grid.”

At the school, classes are being taught outdoors and kids sit under a few trees with notebooks in their laps. Their old and crumbling school will soon be replaced by a new building that will accommodate 200 students. Their faces light up when they talk about the new school, and I feel thankful for being able to work with projects like this where I see the direct effects of our work on kids’ education.

The money to build the school comes from the sale of carbon credits. KenGen received the credits for investing in renewable energy that displaces dirtier sources such as coal in the national grid, and the company then sells them to the World Bank’s Community Development Carbon Fund (CDCF). The fund pays KenGen a premium on the credits, but in return requires that part of the revenue stream from the credits is used for social co-benefits.

Each project supported by the fund has to implement a Community Benefit Plan, and in this case it included a primary school for the local community and construction of three new classrooms at the nearby Ngaambani Nursery School.

But that’s not all. It also includes the construction of a livestock water pan that helps some 500 people and 5,000 livestock access water every day. The plan also calls for the installation of a 10-kilometer long water pipeline extension to the Maiella community adjacent to the national park and to a community health center.

On November 1, the Olkaria II Geothermal Expansion Project  issued its first carbon credits. This makes it the first project in Kenya to earn certified greenhouse gas emission reductions under the Clean Development Mechanism of the United Nation Framework Convention on Climate Change (UNFCCC).

It’s been a long time coming.

It took seven years of preparation, including the project eligibility validation and the verification of the actual emission reductions generated during the first monitored period. But seeing the kids excited about writing on a table instead of hunched over under a tree, made the cumbersome auditing process worth it to me.

While these benefits may be the most visible, they are not the only ones. Projects like KenGen’s have an enormous impact on technology transfer and capacity building.

My counterpart at KenGen, Pacifica Achieng, is a Kenyan national from the Lake Victoria region who was the first-ever Ph.D. graduate from Africa in Iceland – a global leader in geothermal development. Achieng’s thesis was titled "Social, economic and environmental impacts of harnessing geothermal energy through the UNFCCC climate change management and the Millennium Development Goals (MDGs) in two areas in the Great Rift Valley in Kenya."

So far, 72 Kenyan professionals have graduated from the United Nations University Geothermal Training Program in Iceland since the program was launched in 1979. This is truly development aid at its best, as the World Bank’s Managing Director Sri Mulayni writes in her blog, "What do Iceland and Kenya have in common?

Kenya, along with other countries along the African Rift Valley, has a big potential for geothermal energy. It is clear that for the country to boost its renewable energy portfolio and meet its goal to generate 30 percent of the nation’s power from geothermal energy by 2020, there must be close collaboration between a slew of stakeholders.

Developed and developing countries, the private and public sector, local communities, and international aid organizations all need to come to the table because there isn’t enough money available from just one source to fund low-carbon energy sources.

Blending traditional World Bank loans – which have been supporting geothermal development in Kenya since the 70s – with innovative climate finance such as the use of carbon credits, as in the case of the Olkaria II Geothermal plant, may be the future to funding a green revolution across Africa.

This is how we can provide low-carbon energy as well as better schools for the kids.

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Blending traditional World Bank loans – which have been supporting geothermal development in Kenya since the 70s – with innovative climate finance such as the use of carbon credits, as in the case of the Olkaria II Geothermal plant, may be the future to funding a green revolution across Africa.

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