Egypt cabinet reshuffle will not disrupt utilities sector

15 September 2015

Fast-tracked projects should proceed as planned

  • Sources in Egypt projects market do not expect the cabinet reshuffle to affect utilities projects
  • Essential power and water projects are being fast-tracked to meet demand

Key projects in the utilities and energy sector will not be affected by the resignation of Egypt’s cabinet on 12 September.

Projects that are already advanced and are seen as priority projects should see no or only minor delays.

“We are not worried about energy sector projects,” says a representative of a development bank in Egypt. “They are on the fast track, as they are important for securing access to electricity and energy.”

Cairo is working hard to meet the rapidly increasing demand for power. The peak load rose from about 13,300MW in the 2001/02 fiscal year to 27,000MW in 2012/13, leading to frequent summer power cuts. Peak demand grew by 6 per cent in 2014 and is forecast to continue expanding at this rate until 2022.

The Electricity & Energy Ministry is planning to develop 54GW of new power capacity by 2022, at a rate of about 6.5GW a year. Both thermal power plants and renewables projects are seen as vital parts of this plan

Water sector projects that are well advanced should also be safe.

“The client doesn’t expect the project to be affected,” says a source close to the Abu Rawash wastewater treatment plant expansion, which will require an initial investment of more than €500m ($561m). “It is a priority project that has been endorsed by the president.”

Electricity & Renewable Energy Minister Mohamed Shaker and the finance minister, who oversees the Public-Private Partnership (PPP) Central Unit, are expected by the local press to keep their positions in the reshuffle. Outgoing Oil Minister Sherif Ismail is forming a new cabinet.

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