Egypt commits to renewables

27 November 2014

Cairo now faces the challenges of implementing and financing the projects

Egypt’s new government is demonstrating serious commitment to renewables, as the of Electricity & Energy Ministry and the Egyptian Electricity Holding Company (EEHC) receive expressions of interest for a huge 4,300MW wind and solar programme.

The establishment of feed-in tariffs in September was a crucial step towards creating the framework for direct proposals. Developers and investors can now have some confidence of returns on their investment and interest is reported to be high.

Egypt is following in Jordan’s footsteps. The first round of Jordan’s renewables programme also solicited direct proposals on a feed-in tariff basis. However, Amman has faced multiple problems with insufficient grid capacity and lack of expertise to handle all the projects.

The Jordanian Ministry of Energy & Mineral Resources (MEMR) eventually signed off on 12 projects with a total capacity of 170MW in 2014 after long delays. The second round of projects was postponed and the third cancelled.

And where Jordan started small, Egypt’s proposed programme is about 25 times more ambitious and implies at least 800 projects between 20MW and 50MW.

The implementation, scheduled to take two years, will demand considerable institutional capacity at the ministry and EEHC. The timeline is tight with only a month to compile a list of prequalified companies. It is a new model for Egypt and success is far from guaranteed.

But even if the programme is ultimately delayed or downsized, Cairo is demonstrating – through this and the recent revival of its nuclear project –it is determined to resolve its current power shortages and fuel crisis, and is willing to try all methods.

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