The European Bank for Reconstruction and Development (EBRD) has allotted up to US$ 500 million during next year to support Egypt’s new solar energy program.
Egypt aims to add up to 2GW of utility-scale solar as part of its goal of sourcing 20 per cent of its electricity needs from renewables.
The 2GW will likely be attained through 40 solar power projects of around 50MW each; many of which will be located on a site set aside to host 1.8GW near Benban – the largest solar park in the world.
The EBRD expects to finance a number of plants up to US$ 500 million and to access US$ 1.5 billion in debt and equity from other financiers. In total, the cost of the Benban project is in the region of US$ 4 billion.
“Egypt currently relies to a large extent on traditional power generation fuelled by costly hydrocarbon imports, however the government has an ambitious strategy to obtain 20 per cent of the country’s electricity from renewable sources by 2020,” stated Philip ter Woort, EBRD Country Director for Egypt.
“Egypt is well placed to do so as it has world-class solar resources and in some places, especially in the Gulf of Suez, great potential for wind power.”
The solar projects will be constructed entirely by private firms.
According to the Energy Information Administration, Egypt is the largest oil and natural gas consumer in Africa
Approximately 70% of Egypt’s electricity is sourced from gas fired power generation, with the remainder being fueled by petroleum and renewable energy; most of which is hydro.
“Egypt experiences frequent electricity blackouts because of rising demand, natural gas supply shortages, aging infrastructure, and inadequate generation and transmission capacity,” says the EIA.
Ongoing turmoil within the nation has negatively impacted on the government’s plan to expand power generation capacity by 30 GW by 2020.
With regard to its aspirations of 20% renewables by 2020; 12% would be wind, 6% hydro, and 2% solar.
Last month the EBRD also announced a financing program to boost renewable energy generation via the private sector in North African and Middle Eastern countries; including Egypt.
