In what the government describes as a milestone in green industrialisation, Kenya has broken ground on a KSh 103.2 billion (approx. US$800 million) fertiliser manufacturing plant at the Olkaria geothermal field in Nakuru County.
The facility is a joint venture between state-owned KenGen and China’s Kaishan Engineering Group and is slated to produce between 200,000 and 300,000 tonnes of “green” ammonium- based fertiliser annually, powered by 165 MW of geothermal steam.
“This project shows that Kenya is not just a leading producer and consumer of clean energy. We are now going further to add value and generate prosperity from it,” said President William Ruto at the ceremony.
KenGen Managing Director/CEO Peter Njenga described it as “a milestone in clean industrialisation… geothermal power is the bridge between Africa’s green energy potential and its manufacturing future.”
What’s happening
The plant will be developed by Kaishan’s local subsidiary, Kaishan Terra Green Ammonia Ltd, which will construct and operate the facility for 30 years under a steam-supply agreement with KenGen. KenGen will supply the geothermal steam, making the facility uniquely positioned: manufacturing fertiliser using renewable heat, rather than fossil-fuel-based processes.
With Kenya importing nearly 900,000 tonnes of fertiliser annually before the project, plus significant cost exposure to global gas and shipping prices, the plant offers a potential shift in the national agriculture input economy. KenGen projects annual net profit from its steam supply alone at around US$13 million (approx. KSh 1.7 billion).
Why this is it important?
For farmers across Kenya, fertiliser cost has been a driving variable in staple-crop yields (especially maize). By reducing import dependency and lowering exposure to global energy shocks, the project supports food-security and price stability. President Ruto noted the facility will help “shield farmers from global price shocks” and bolster Kenya’s export competitiveness.
From an industrialisation and climate perspective, this is a bold move. Africa’s manufacturing has historically been energy-intensive and reliant on fossil inputs. A geothermal-driven fertilizer plant flips that paradigm and positions Kenya as a potential regional hub for value-added manufacturing tied to clean energy. It aligns with global trends in “green ammonia” and “clean fertiliser” as climate-smart inputs.
The future and what to watch
- Operational ramp-up: The plant is expected to become fully operational within the next 24-36 months. How quickly it reaches the 200,000-300,000 tonne annual capacity will determine its market impact.
- Price transmission: Will lower input costs be passed to farmers? Monitoring how fertiliser bag prices shift will show whether the benefit reaches grassroots agriculture.
- Regional export potential: Beyond import substitution at home, the plant could supply fertiliser to East-Africa and COMESA markets, a step forwards for Kenya’s regional manufacturing role.
- Carbon credits and green finance: With annual emission savings of >600,000 tonnes of CO₂ projected, there may be opportunities for carbon-credit monetization, adding another revenue stream.
- Skills and local participation: The project is expected to create 2,000+ direct & indirect jobs in operations, maintenance, logistics, plant engineering and supply chains. Building local capacity will be key to long-term impact.
The KenGen–Kaishan green fertiliser project is not simply another industrial plant, it represents a strategic intersection of manufacturing, agriculture, clean energy and export ambition.
If delivered effectively, it can help break Kenya’s dependence on imported fertiliser, strengthen farmer resilience, and create a blueprint for “green industrialisation” in Africa. Whether it delivers on scale, affordability and regional reach will determine whether this becomes a best- practice case or a flagged ambition.
