Geothermal handbook: PlanninG and Financing power Generation t e c h n I c a L r e p o r t 2 / 2

F I g u r E 3 . 1 0
Location of Geothermal Resources in Kenya
Source | World Bank 2010a.
Nairobi
LEGEND
Quaternary
Volcanoes
Lakes
Faults
Geothermal 
Area
Lake Turkana
Lake Turkana
Nazara Rift
Olkaria
volcanic complex
Lake Nakulu
Lake Naivasha
Barrier
Namarunu
Emuruangoglak
Silali
Paka
Korosi
Menengai
Lake Baringo
Lake Bogoria
Nakuru
Margaret
Longonot
Suswa
Lake Elmenteita
Naivasha
Kisumu
Shompole
Ol’Doinyo Lengai
Arus
Lake Magadi
Lake Natron
2
O
N
0
O
N
2
O
s
36
O
E
38
O
E
Eburru
Nairobi

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Outlook for Private Insurance
The availability of large portfolios of geothermal projects offers fertile ground for insurance schemes. 
Risk management through diversification is the foundation of the insurance industry. A stronger private 
sector role could be achieved through increasing involvement of private insurance companies in the 
provision of geothermal exploration guarantee/insurance schemes. Initially, including some element 
of public sources of subsidized capital (grants from governments, donors, or climate finance) would 
reduce the cost of coverage. This is how the GeoFund program supported by GEF initially operated 
in the World Bank client countries of Europe and Central Asia region. However, it is hoped that the 
insurance industry and private equity investors will fill this market niche in the future. 
The geothermal industry seems to be in greater need of such insurance instruments than the oil 
and gas industry in which private investors absorb the exploration risk. The entry of the insurance 
industry into the sector, which is already happening in advanced markets, is likely to expand into the 
more geologically promising locations in the developing world once a critical mass of hard data is 
accumulated about the level of risk involved. The International Finance Corporation (IFC) in Turkey is 
helping to move this process forward by building a large database of drilling results available from 
the geothermal industry. The Geothermal Well Productivity Insurance (GWPI) facility for Turkey may 
be the first example of an international insurance company covering geothermal resource risk outside 
of continental Europe. The scheme involves local insurance companies providing the immediate 
coverage and the international insurance company providing reinsurance.