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Thursday, 19 October 2017

Egypt getting USD 1.8 bn in solar power investment

EBRD approves funding for three remaining solar power plants under USD 500 mn framework: The European Bank for Reconstruction and Development (EBRD) approved financing for three solar power plants in Egypt under its USD 500 mn renewable energy framework, a statement said yesterday (pdf). This brings the total number of projects under the framework up to 16, with a combined capacity of 750 MW, making EBRDthe single largest investor in renewable energy in Egypt.”

Co-financing with China: The three newly-approved projects, which were allocated a USD 73 mn package, will be co-financed by the Industrial Commercial Bank of China, with a matching loan from the Multilateral Investment Guarantee Agency. Saudi’s ACWA Power will be developing the plants with China’s CHINT Solar and Egypt’s Al Tawakol Electrical Co. under phase two of the feed-in tariff program in Benban, Aswan. “These will be the first private utility-scale renewable-energy projects in a country whose energy sector is otherwise dominated by the use of hydrocarbons. The projects are expected to lead to many more investments that will improve Egypt’s energy mix through greater use of sustainable energy sources.”
Egypt is drawing in USD 1.8 bn in solar power investment largely from the EBRD and the World Bank’s International Finance Corporation (IFC), Anna Hirtenstein writes for Bloomberg. EBRD is backing 16 photovoltaic projects, and the IFC is financing 13 with a combined capacity of 1.4 GW in Benban. The site is expected to have a capacity of 1.8 GW and cost USD 2.8 bn by the time the projects are completed in 1H2019. EBRD and IFC are “writing loans for USD 380 mn and USD 203 mn, respectively, and have mobilized the rest from co-investors,” Hirtenstein writes. IFC has lined up loan agreements for all of its projects except two, which it expects to sign this week, spokeswoman Riham Mustafa said.

After years of wrangling, we have the right regulatory framework in place: EBRD’s loans are financing “the first private renewable energy projects in Egypt, and it’s not an easy macroeconomic or geopolitical situation … Yet because it’s got the right regulatory framework in place, Egypt has been able to attract all of these different investors and should comfortably get more than a gigawatt of capacity financed this year,” EBRD Head of Power & Energy Utilities Harry Boyd-Carpenter says.

The comes as the EBRD and Électricité de France signed a USD 150 mn contract with Elsewedy Electric to build two solar power plants with a combined capacity of 100 MW at the Union for the Mediterranean’s Energy and Climate Business Forum in Cairo on Wednesday, according to a statement from the Investment and International Cooperation Ministry.

Gaza is also getting some solar power as well, with three new solar energy plants set to be operational by April, Reuters reports. US-based Samaha Group will build the plants that will produce a total of 40 MW of power for about EUR 50 mn.

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