Corbetti Geothermal: Pioneering Private Capital in Africa’s Geothermal Future
By: Robert Buluma
On 18 June 2026, at the Africa Energy Forum in Cape Town, the Private Infrastructure Development Group (PIDG) and Taranis Operations Ltd announced a significant milestone for African renewable energy: the signing of a convertible loan agreement into Ethiopia’s Corbetti Geothermal project. This agreement represents the first step in a broader partnership that could see Taranis invest up to USD 27 million in equity into the project. For a project that has been in development since 2009, this announcement signals renewed momentum for one of Africa’s most ambitious geothermal endeavours.
Located within Ethiopia’s Corbetti Caldera, approximately 250 kilometres south of Addis Ababa in the Oromia Regional State, the Corbetti Geothermal project is poised to become one of the first geothermal developments in Africa to be financed and developed entirely by private capital. This article examines the project’s geological significance, its long and complex development journey, the strategic partnership between PIDG and Taranis, and the broader implications for Ethiopia’s energy transition and Africa’s renewable energy landscape.
Geological Context: The Corbetti Caldera
The Corbetti geothermal prospect sits within the Main Ethiopian Rift, part of the East African Rift System—one of the world’s most active continental rift zones. The caldera complex hosts multiple active volcanoes that serve as potential heat sources for geothermal energy generation. The region exhibits rapid uplift, dynamic deformation, and significant seismic activity, all indicative of a high-energy geothermal system.
The geological setting is remarkably promising. The Corbetti resource compares in size to the Olkaria resource in Kenya, which currently hosts one of the largest geothermal fields in the world with installed capacity standing at 905MW. Surface exploration indicates the Corbetti resource may support up to 500 MWe of installed generation capacity.
The volcanic complex sits near the city of Awassa, bounded by Lake Awassa to the south and Lake Shalla to the north. Recent geophysical research has produced new subsurface 3‑D electrical conductivity models of Corbetti through the inversion of 120 magnetotelluric stations. These models provide crucial data for quantitative evaluation of the geothermal potential and assessment of volcanic risks, enabling more confident development planning.
Project Overview and Phased Development
The Corbetti Geothermal project is planned for development in two primary phases. The first phase, following the completion of exploration drilling, will consist of production wells and a steam field supplying a 50MW geothermal power plant. The second phase is expected to develop an additional 100MW of capacity.
The Power Purchase Agreement (PPA) with Ethiopian Electric Power (EEP) sets out commercial terms for a geothermal project of up to 150MW split across these two phases. Importantly, the PPA also grants Corbetti Geothermal PLC a right of first refusal over further expansion in the licence area. This provision is significant given that early surface exploration data suggests the resource could ultimately support up to 500MW of installed capacity.
In May 2024, Corbetti Geothermal PLC was awarded a two‑year time extension under its PPA with EEP, allowing the project to proceed with its exploration drilling programme. The company subsequently announced plans to proceed with a three‑well exploratory drilling programme to confirm the inferred resource. This will allow the optimum development strategy to be developed based on the indicated resource characteristics, estimated potential electricity generation capacity, and EEP’s expansion plans—all to be documented in a bankable Feasibility Study.
A Decade of Development: The Long Road to Corbetti
The Corbetti Geothermal project has been under development since 2009, making it one of the longest‑running geothermal development efforts in Africa. Iceland’s Reykjavik Geothermal began active development in 2011, with Berkeley Energy and the Iceland Drilling Company joining as sponsors in 2014.
A pivotal moment came in 2015 when InfraCo Africa—a PIDG company—formed a joint venture company with Berkeley Energy to jointly become the majority shareholder in Corbetti Geothermal. This marked PIDG’s first investment in both geothermal energy and Ethiopia.
In January 2018, InfraCo Africa signed a shareholders’ agreement with Berkeley Energy that doubled its equity commitment to the project to USD 30 million—USD 25 million in equity finance and USD 5 million in standby equity. At the time, this represented approximately 20% of the funding required to begin drilling up to six exploration wells and building a 10‑20MW pilot plant. InfraCo Africa’s executive director at the time described it as a landmark deal, being the organisation’s first in geothermal and in Ethiopia, and the largest single commitment made to date.
In December 2017, a Power Purchase Agreement was signed for Corbetti, alongside the Tulu Moye geothermal project. This was followed in 2020 by the signing of a new PPA and Implementation Agreement with the Government of Ethiopia and Ethiopian Electric Power. The agreements marked the next step for the pioneering project, allowing it to move into the next phase of implementation and commence the drilling programme.
By 2022, the project underwent an ownership change, with Meridiam joining InfraCo Africa and Reykjavik Geothermal as shareholders. The project’s complex evolution has been necessary to manage the early‑stage development risks and costs associated with being a pioneer in African geothermal development.
PIDG: A Decade of Commitment
The Private Infrastructure Development Group (PIDG) is an innovative infrastructure project developer and investor that mobilises private investment in sustainable and inclusive infrastructure in sub‑Saharan Africa and South and Southeast Asia. Since 2002, PIDG has supported 286 infrastructure projects to financial close, providing an estimated 240 million people with access to new or improved infrastructure. PIDG is funded by the governments of the United Kingdom, the Netherlands, Switzerland, Australia, Sweden, and Global Affairs Canada.
Through its project development arm, InfraCo Africa, PIDG has been committed to the Corbetti Geothermal project since 2015. PIDG’s total commitment to the project stands at under USD 30.8 million, comprising equity of less than USD 30 million and technical assistance of USD 787,000.
Beyond equity investment, PIDG has provided extensive technical assistance. Grants have supported activities including drinking water feasibility studies, studies on the use of geothermal brine, solar power provision for local health clinics, legal support to the government, and feasibility studies to partially replace diesel generators with solar generators during construction. A PIDG grant also funded a study into the potential for heat from the geothermal project to support an agricultural industrial park.
The CEO of InfraCo Africa articulated the organisation’s long‑term commitment in 2024, stating that InfraCo Africa was excited to support Corbetti Geothermal as it progressed towards exploratory drilling. Having been committed to Corbetti for many years, the organisation remains dedicated to working with partners to develop Ethiopia’s geothermal resource to ultimately deliver clean, baseload power for the benefit of the country’s domestic and business customers.
Taranis: A New Strategic Partner
Taranis Operations Ltd is an impact‑investment vehicle active in sustainable energy, carbon management, and nature‑based solutions. Unlike traditional investment funds, Taranis adopts the position of an active operator, envisioning a long‑term, high‑impact strategy where people and innovation are at the centre of each initiative. Through its Energy for Africa vertical, Taranis has set an ambitious target to install 1 GW of capacity across the African continent by 2030.
The convertible loan agreement signed in June 2026 marks Taranis’s entry into the Corbetti project. The agreement is structured as a first step toward a more extensive partnership that includes the prospective investment of USD 27 million in equity.
Taranis CEO Emmanuel Colombel framed the partnership in terms of value creation: “Corbetti Geothermal is the kind of project where Taranis can deliver the greatest value. By helping to overcome complex technical challenges and accelerate project development, we are supporting the expansion of reliable, low‑carbon energy in Ethiopia.” Colombel further emphasised the project’s broader significance: “Corbetti is the perfect opportunity to demonstrate how geothermal power can play a critical role in improving energy access for people and businesses in the region.”
Financing Structure and Risk Mitigation
The Corbetti project exemplifies the complex financing structures required for pioneering geothermal development in Africa. The project has drawn on multiple sources of funding and risk mitigation:
Equity Investment: InfraCo Africa’s USD 30 million equity commitment represents a foundational layer of project finance. The prospective USD 27 million equity investment from Taranis would substantially strengthen the project’s capital base.
Convertible Loan: The initial Taranis investment takes the form of a convertible loan agreement—a flexible instrument that can convert to equity, providing both immediate capital and future ownership optionality.
Geothermal Risk Mitigation Facility (GRMF): The project has received support from the AU’s Geothermal Risk Mitigation Facility for Eastern Africa, which provided bridging finance to manage the substantial exploration risks inherent in geothermal development.
Technical Assistance: PIDG’s technical assistance grants, totalling USD 787,000, have supported various preparatory activities.
Power Purchase Agreement: The PPA with Ethiopian Electric Power provides revenue certainty by establishing commercial terms for power off‑take.
Implementation Agreement: The IA with the Government of Ethiopia provides regulatory and legal certainty.
This multi‑layered approach to financing and risk mitigation is essential for geothermal projects, which face high upfront exploration costs and significant resource uncertainty.
Ethiopia’s Energy Context
Ethiopia’s energy landscape provides the essential backdrop for understanding the Corbetti project’s significance. The country possesses abundant renewable energy resources, with the potential to generate over 60,000 MW from hydroelectric, wind, solar, and geothermal sources. However, the country has utilised less than 7% of its total potential.
Currently, approximately 90% of Ethiopia’s electricity comes from hydropower. While this has provided a relatively clean energy mix, hydropower generation is increasingly vulnerable to variations in rainfall patterns due to climate change. This vulnerability was starkly demonstrated during recent drought periods when hydroelectric generation dropped sharply, exposing the risks of over‑reliance on a single source.
The Ethiopian government’s National Electrification Program, updated in 2019, aims to achieve universal access to electricity by 2025 through a combination of grid expansion, solar home systems, and off‑grid sources. This objective requires 13.5 GW of grid‑connected generation capacity, including 840 MW from developing the country’s geothermal sources.
Geothermal energy offers particular advantages for Ethiopia’s energy mix. Unlike hydropower, geothermal provides baseload renewable electricity—reliable, continuous power that is not subject to weather variability. The Corbetti project, along with other developments such as Tulu Moye (150MW) and Aluto‑Langano II (70MW), is scheduled to begin contributing to the grid.
Challenges and Delays
The path to development has not been smooth. Large geothermal projects from independent power producers—including Tulu Moye, Corbetti, and Aluto‑Langano II—have faced delays tied to drilling challenges, procurement setbacks, and financing timelines. The Corbetti project has overcome a number of challenges in recent years, requiring persistent effort from all stakeholders.
The project has evolved significantly over time. Originally envisioned with a larger scope, the development has been restructured to manage early‑stage risks more effectively. The overall project size was reduced to a total of 150MW, with the full programme enabling the Government of Ethiopia to meet 18% of its 2025 geothermal generation target.
Despite these challenges, the project has continued to make progress. Site preparation work has been completed, including the drilling of four water wells to supply water for the drilling rig. Access roads built by the project have already significantly improved mobility in the vicinity, promoting trade of agricultural produce. Work to upgrade these roads to accommodate large drilling equipment has been completed, and clearing and earthworks are underway to build the well pads.
Development Impact
The Corbetti project promises substantial development impact across multiple dimensions:
Energy Access: The project will contribute to Ethiopia’s goal of universal electricity access, providing homes and businesses with reliable power.
Climate Action: By developing geothermal energy, Ethiopia can reduce its reliance on imported fossil fuels and pursue carbon‑neutral growth.
Economic Development: The development of geothermal energy, combined with energy efficiency initiatives, will generate a surplus of energy that can be exported through planned interconnections, improving Ethiopia’s balance of payments by billions of dollars by 2030.
Community Benefits: The project has already delivered tangible community benefits. Access roads have significantly increased mobility in the area, helping local residents get to school and market. A new water system will be installed as part of the project, and plans include supplying drinking water to local communities experiencing water stress.
Knowledge Transfer: As one of the first privately developed geothermal IPPs in Ethiopia—and only the second country in sub‑Saharan Africa to promote large‑scale development of privately operated geothermal energy—Corbetti will generate valuable knowledge and experience.
The Broader African Geothermal Landscape
Corbetti is not an isolated initiative but part of a broader African geothermal story. The East African Rift System contains some of the world’s most promising geothermal resources, yet the continent has barely scratched the surface of its potential.
Kenya has led the way, with the Olkaria fields demonstrating what is possible with sustained investment and technical expertise. Ethiopia, with its vast geothermal potential concentrated in the Rift Valley, is positioned to follow. The power purchase tariff rates for geothermal projects under implementation in Ethiopia—0.0695 USD cents/kWh for Tulu Moye and 0.0753 USD cents/kWh for Corbetti—reflect the commercial viability of these developments.
The involvement of private capital is crucial to unlocking this potential. Traditional development finance and government budgets alone cannot fund the scale of investment required. By demonstrating that geothermal projects can attract private investment, Corbetti and Tulu Moye are establishing a template that could be replicated across the region.
Conclusion
The PIDG‑Taranis partnership on the Corbetti Geothermal project represents more than a financing agreement. It signals the maturation of African geothermal development from government‑led exploration to commercially viable, privately financed energy infrastructure.
After more than a decade of development, the project is approaching a critical phase. The convertible loan from Taranis provides immediate capital for exploration drilling, while the prospective USD 27 million equity investment would significantly strengthen the project’s financial foundation. The two‑year PPA extension granted in May 2024 provides the regulatory certainty needed to proceed.
Omar Jabri, Head of Business Development (Africa) for InfraCo at PIDG, captured the project’s significance: “Harnessing the potential of geothermal energy to provide Ethiopia’s homes and businesses with sustainable, baseload power has long been our priority, and we are pleased to reach this important milestone with our partners today.”
For Ethiopia, Corbetti offers a path to energy diversification, reduced vulnerability to climate variability, and enhanced energy security. For the broader African continent, it demonstrates that geothermal energy—long recognised for its potential but seldom realised—can attract private capital and deliver reliable, clean power. As Taranis CEO Emmanuel Colombel noted, Corbetti is “the perfect opportunity to demonstrate how geothermal power can play a critical role in improving energy access for people and businesses in the region.”
The coming years will determine whether Corbetti fulfils its promise. With exploration drilling imminent, a strengthened partnership between PIDG and Taranis, and continued support from the Ethiopian government, the project is positioned to become a landmark in African renewable energy development—proof that the earth’s heat can power a continent’s future.
Source: PIDG
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