Globeleq’s 35MW Delay Deepens Kenya Power Rationing Crisis

Globeleq Delays Power Supply: Kenya's Energy Crunch Worsens

By Robert Buluma 

Published: May 29, 2026

There is an uncomfortable truth settling over Kenya’s electricity sector this week. Just as the country’s industrialists were beginning to breathe a sigh of relief that the worst of the power rationing might be over, a new storm has appeared on the horizon. The British independent power producer, Globeleq, has officially delayed the connection of its 35-megawatt geothermal plant to the national grid.

For the average Kenyan who has grown accustomed to the lights flickering off precisely at 6:30 PM, this might sound like just another technical footnote in a long list of energy sector woes. But for those who watch the numbers closely, this is a significant blow. It is a delay that threatens to prolong the agony of scheduled blackouts, pressure Kenya Power’s already strained finances, and expose the fragility of a national grid that is struggling to keep pace with a growing economy.

The Business Daily report that broke this story painted a picture of a project stuck in limbo. Globeleq, a heavyweight in African energy development, was expected to begin trial supply to Kenya Power this month. Full commercial commissioning was scheduled for next month. But those timelines have evaporated. Instead, the utility and the generator are stuck waiting, and Kenya’s evening peak hours remain a gamble between darkness and light.

The Menengai Reservoir: A Promise Deferred

To understand why this delay hurts so much, we have to travel to the floor of the Rift Valley. The Menengai geothermal reservoir is not just another patch of volcanic land. It is one of the most ambitious renewable energy projects in East Africa. Situated near Nakuru, this caldera holds the potential to generate vast amounts of cheap, reliable, baseload electricity. Unlike solar panels that go silent when the sun sets or wind turbines that freeze when the breeze dies, geothermal power runs 24 hours a day, seven days a week. It is the backbone of a modern green grid.

Globeleq is one of three independent power producers granted licenses to develop steam wells in this zone. The idea was elegant: the Geothermal Development Company, a state-owned enterprise, would drill the steam wells and sell the steam to private producers like Globeleq. Those producers would then use the steam to turn turbines and sell the electricity to Kenya Power.

Unfortunately, elegance does not always translate to speed. Globeleq was, in fact, the laggard in this race. Two other producers at Menengai, OrPower 22 and Sosian Energy, have already completed their plants. Sosian Energy began feeding power into the national grid way back in June 2023. OrPower 22 followed suit in April of this year. They are active, they are earning revenue, and they are helping keep the lights on. Globeleq, however, remains on the sidelines.

According to the acting managing director of the Geothermal Development Company, Stephen Busieney, the hold-up is tied to the steam supply. GDC is responsible for delivering that geothermal steam to Globeleq’s turbines. Failure to meet contractual steam deadlines usually triggers financial penalties, though no specific figures have been made public. The official line describes "unexpected challenges," which is energy sector jargon for a cascade of engineering, logistical, or financial hurdles that have yet to be resolved.

Why 35 Megawatts Matters

Thirty-five megawatts sounds like a small number. On paper, it is barely a fraction of Kenya’s installed capacity. But the electricity business is not about paper; it is about timing. You cannot eat installed capacity. You have to eat dispatched capacity—the power that actually flows through the wires when you need it.

Right now, Kenya is in a precarious position. Kenya Power recently admitted that it is forced to ration supply between 6:30 PM and 10:00 PM every evening. Why? Because the grid is facing a structural deficit created by the intermittency of renewable sources. During the day, solar panels are flooding the system with cheap electricity. But the moment the sun dips below the horizon, that supply evaporates almost instantly. At the same time, wind generation has been unusually low recently, with some plants operating at near-zero capacity due to seasonal wind patterns.

This leaves a gap. And that gap is currently being filled by expensive, diesel-powered thermal generators that hum to life just as families are sitting down to dinner. But those thermal plants are not just expensive; they are also subject to fuel supply disruptions and maintenance cycles. The grid has very little room for error.

Geothermal is the obvious solution to this evening crunch. It does not care if the sun is up or down. It does not care if the wind is blowing. A 35-megawatt geothermal plant is like a steady, muscular horse pulling the cart. It may not be flashy, but it gets the job done. Without Globeleq’s 35 megawatts, Kenya Power must either burn more diesel, which drives up the cost of electricity, or cut supply to neighborhoods, which destroys small businesses and frustrates households.

A $117 Million Question

Let us talk about money, because energy delays are rarely just about engineering. They are about balance sheets. Globeleq has invested a staggering $117 million into this plant. That is roughly 15.15 billion shillings sitting in Menengai, waiting to generate a return.

When a project of this size misses its commercial operation date, the financial ripples spread far and wide. Globeleq itself suffers from delayed revenue recognition. Its lenders, who advanced loans expecting repayment starting next month, grow anxious. Kenya Power, for its part, loses the opportunity to add cheaper geothermal power to its mix, forcing it to rely on more expensive emergency procurements.

But there is a deeper financial worry here. Kenya Power has not signed any new Power Purchase Agreements since the government lifted a freeze on these deals last November. That freeze had been imposed because the utility was paying for power it did not need, a situation that led to near-collapse at the turn of the decade. Now that demand has caught up and surpassed supply, the utility is desperate for new capacity. However, even if the government signed a PPA today, it would take at least two years to build a new plant. That means the only sources of relief in the short term are projects already under construction—like Globeleq’s.

The delay therefore creates a double bind. Kenya Power cannot easily replace the missing megawatts, and Globeleq cannot start earning its return. The longer the standoff continues, the more pressure builds on both parties to find a resolution.

The Olkaria Double Whammy

If the Globeleq delay were an isolated incident, the grid might survive. But it is not isolated. Energy delays in Kenya tend to travel in packs.

At the same time that Menengai is struggling, the Kenya Electricity Generating Company is fighting its own battle at Olkaria. The 63-megawatt Olkaria I power plant has been out of service since 2023. That is not a typo. For three years, one of the country's flagship geothermal units has been sitting idle, waiting for a major rehabilitation. That rehabilitation is finally underway, but it is not complete.

When the Globeleq plant is finally operational, and when the OrPower plant continues its run, and when the Olkaria I unit is brought back to life, those three sources combined are expected to inject 133 megawatts of new geothermal power into the grid. That is a significant amount. It is roughly equivalent to the peak demand of a midsized town. But every month that passes without these plants coming online is another month of rationing, another month of diesel burns, and another month of frustrated consumers.

The rehabilitation of Olkaria I, like the completion of Globeleq, has been plagued by what industry insiders euphemistically call "supply chain constraints." In plain English, that means parts are not arriving on time. Transformers are stuck at ports. Specialist engineers are booked months in advance. The global energy industry is still recovering from the whiplash of the post-pandemic supply chain collapse, and Kenya is feeling the pain acutely.

The Grid That Cried Blackout

Meanwhile, on the ground, the reality is grim. Kenya Power continues to announce lengthy maintenance outages across the country with a frequency that has become almost routine. Just yesterday, the utility published a notice detailing an eight-hour disruption covering Nairobi areas like Ngong Road, Zimmerman, and parts of the Rift Valley.

Officially, these are "network maintenance" outages. And certainly, aged infrastructure needs constant care. But the subtext is impossible to ignore. When a utility schedules routine maintenance during evening peak hours, it is a sign that the system is stretched thin. In a healthy grid, maintenance happens in the middle of the night, or during low-demand weekends. In Kenya right now, maintenance happens whenever the grid can spare the capacity, which is increasingly rare.

Business owners are bearing the brunt. A welder in Industrial Area cannot work if the power cuts at 7 PM. A restaurant in Westlands loses perishable food when the refrigerator cycles off for two hours. A small manufacturer in Thika faces overtime costs when production is interrupted. These are not hypothetical scenarios. They are the daily reality of a grid that is operating on a knife's edge.

The irony is that Kenya actually has enough installed capacity on paper. The country can generate well over 3,000 megawatts from various sources. But paper capacity means nothing when hydro levels drop because of drought, when wind speeds fall below operational thresholds, and when new geothermal projects arrive late. The effective capacity—the power that is actually available at 8 PM on a windless, dry evening—is much lower than the headline numbers suggest.

A History of Optimism and Overruns

To be fair to Globeleq, construction delays are not unique to this project. The history of large-scale energy infrastructure in Kenya is a history of missed deadlines. The Lake Turkana Wind Power project, now a celebrated success, was delayed for years by legal battles and transmission infrastructure issues. The various solar plants across the country faced their own commissioning headaches.

The difference is that those earlier delays occurred during a period of surplus. When Lake Turkana was delayed, the grid had enough hydro and diesel to compensate. Today, there is no surplus. There is a deficit. So a delay that might have been a minor inconvenience in 2018 is a crisis in 2026.

Demand has simply grown too fast. Peak demand hit a record 2,439 megawatts last December, driven by a resurgent economy, increased manufacturing activity, and the ongoing electrification of households. The government should be praised for connecting millions of new customers to the grid. But every new connection adds load. And the supply side has not kept up.

The Rationing Dilemma

Kenya Power is caught between two impossible demands. On one side, the utility must protect the stability of the grid. If it fails to shed load during peak hours, the entire system could collapse. A total blackout, the kind that leaves the whole country dark for hours or days, is far more damaging than scheduled rationing. So the engineers at the control center make tough calls: cut this feeder, preserve that one.

On the other side, the utility faces the wrath of customers who pay their bills on time and expect reliable service. Every night at 6:30 PM when the power goes out in a Nairobi estate, a hundred small businesses lose a hundred small opportunities. The political temperature rises.

Globeleq’s delay means this rationing regime will likely continue into the third quarter of the year. Even if the trial supply began tomorrow, it would take weeks to stabilize the plant and integrate its output into the grid. And trial supply is not even scheduled yet.

The Political Economy of Delay

We would be naive to discuss this purely as a technical or financial issue. There is a political economy at play. Globeleq is a foreign investor. The Geothermal Development Company is a state entity. Kenya Power is a publicly traded but state-influenced utility. The relationship between these three actors is governed by contracts that run to thousands of pages, each clause negotiated fiercely.

When a delay of this magnitude occurs, the question of liability inevitably arises. Is GDC at fault for failing to deliver steam on time? Is Globeleq at fault for failing to build its plant fast enough? Is Kenya Power at fault for not providing adequate transmission infrastructure? The answer is almost always a mix of all three.

What the public never sees is the quiet negotiation happening behind closed doors. Penalties are waived. Deadlines are extended. Payment schedules are restructured. These are not signs of corruption; they are signs of a pragmatic industry trying to keep projects alive. If the parties fought every delay in court, nothing would ever get built.

Nevertheless, the pattern is exhausting. Every few years, a major power project is announced with great fanfare. The President cuts a ribbon. The investors shake hands. The media prints optimistic projections. And then, quietly, the commissioning date slips. First by months, then by years. The ribbon gets dusty. The handshake is forgotten.

Lessons from the Menengai Neighbors

It is worth noting that the other two producers at Menengai have succeeded. OrPower 22 is running. Sosian Energy is running. So the technology works. The steam is there. The transmission lines are built. The only missing piece is Globeleq.

This suggests that the problem is not systemic to Menengai, but specific to Globeleq’s execution or its contractual relationship with GDC. Perhaps the company faced unique financing hurdles. Perhaps its turbine supplier went bankrupt. Perhaps the steam pressure at its specific wells was lower than expected. Until a full investigation is completed, we can only speculate.

What we know for certain is that the delay is real, and the consequences are measurable.

What Happens Next?

In the best-case scenario, Globeleq and GDC resolve their issues within the next sixty days. Trial supply begins in August. Commercial operations start in September. The 35 megawatts flow into the grid just as the evening rationing reaches its peak. Kenya Power breathes a sigh of relief, and the maintenance outages become slightly less frequent.

In the worst-case scenario, the dispute escalates. Lawyers get involved. Arbitration is threatened. The delay stretches into 2027. Kenya Power is forced to sign emergency contracts for more expensive diesel generation, passing the costs to consumers in the form of higher tariffs. Small businesses continue to suffer from unpredictable blackouts. The government’s reputation for being investment-friendly takes a hit.

The truth will probably fall somewhere in the middle. Globeleq has too much money on the line to walk away. GDC has too much political pressure to let the project fail. Kenya Power has too much need to let the lawyers win. They will find a way.

But the deeper lesson for Kenya is uncomfortable. The country cannot afford to rely on a handful of mega-projects to keep the lights on. The energy transition requires diversification, yes, but it also requires resilience. That means smaller, faster-to-build plants. That means better maintenance of existing facilities. That means realistic timelines that account for the inevitable delays.

For now, though, the only certainty is uncertainty. When you switch on your lights tonight, spare a thought for the 35 megawatts that are not there. Somewhere in Menengai, a turbine is waiting for steam. And somewhere in Nairobi, a family is waiting for the power to stay on.

 

See also: Ormat raises concerns over Kenya Power Payment Delays 

What do you think? Is the government doing enough to speed up energy projects? Have you been affected by the recent rationing? Share your experience in the comments below.

 Source: Business Daily

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