Saudi Arabia’s Acwa Power has signed a power-purchase agreement (PPA) with the Egyptian Electricity Transmission Company (EETC) for the planned 2,300MW Luxor independent power project (IPP).

The IPP, which will require a total investment of $2.3bn, is scheduled for first power in 2022, with full commercial operation planned by the summer of 2023.

Acwa Power, in partnership with the local Hassan Allam, will develop the plant under a build-own-operate (BOO) framework, with the PPA stipulating that EETC will purchase power for a period of 25 years.

The Saudi developer signed initial agreements for the plant with Egypt’s Electricity Holding Company (EEHC) in 2015, but progress with negotiations were delayed as the site location was changed from Dairut to Luxor.

The gas-fired combined-cycle scheme is regarded as a key project for Egypt’s development, representing the largest IPP tendered to date and also the first one in the market since the late 1990s.

Three build-own-operate-transfer (BOOT) IPPs started up in the early 2000s, each comprising two steam turbine units of about 340MW. The first was undertaken by Intergen, a developer then affiliated with the US’ Bechtel, and Italy'’s Edison at Sidi Krier, east of Alexandria. Two more followed, in Suez and East Port Said, carried out by France’s EDF International.