Abstract
Investments in Geothermal Energy Development Projects (GEPs) are still considered high-risk and capital-intensive with unpredictable completion even amidst the adoption of Public Private Partnership (PPP) financing models particularly in sub-Saharan Africa (SSA). Numerous GEP completion bottlenecks affecting timely project completion have been documented lately; these challenges have caused delayed delivery of critical path milestones, project stalling, and even outright project failures. Recent empirical studies focused more on developed countries' longitudinal secondary databases covering the wider energy sector, with minimal attention paid to the situation of GEPs in developing countries. Anchored on the positivism and pragmatism foundations, this study examined the mediating influence of delivery capability on the relationship between PPP financing structure and the completion of GEPs in Kenya. Using a census survey design, data from 48 geothermal energy projects (private sector project managers and implementation team leaders from the public sector) and key informants was collected and analyzed using mixed methods. Data triangulation and diagnostic tests were performed. The results and findings revealed that while PPP financing structure alone explains 43.9% of the variance in project completion, the inclusion of delivery capability substantially increases the explained variance to 66.1%. A balanced PPP financing structure and delivery capability have statistically significant effects on project completion outcomes, with delivery capability (β = 0.579) having a stronger isolated effect than the PPP financing structure (β = 0.326). The reduction in the PPP financing structure coefficient from the first to the second model suggests that some of its effect is shared with or mediated by delivery capability. The study concluded that completing PPP-financed GEPs requires an integrated approach that considers both predictor variables: A balanced PPP financing structure comprising private equity, commercial and concessional loans, grants and government contributions; and strong delivery capability including geological, technological, PPP modelling and agile project management competencies. Geothermal sector-specific government support measures and industry recommendations are provided to enhance the completion of PPP-financed geothermal energy development projects mainly in the SSA region.
Published Version
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