Saudi Arabias Alfanar Energy has signed a power purchase agreement (PPA) with the Egyptian Electricity Transmission Company (EETC) to develop a 50MW photovoltaic (PV) solar plant under the second round of Egypts feed-in-tariff renewable energy programme.
Alfanar will develop the 50MW plant at the proposed 1.8GW Benban solar complex, located in the Aswan governorate of Egypt.
The Saudi company has secured $55m in non-recourse financing from the European Bank of Reconstruction and Development (EBRD) and the Islamic Corporation for the Development of Private Sector (ICD).
MEED reported in March that three developers had reached financial close for PV IPPs in Benban under the first round of Egypts ambitious 4.3GW feed-in-tariff renewable energy programme.
The first round of the feed-in-tariff programme had been plagued by a number of problems, from the ongoing currency crisis in Egypt to disputes over the omission of an international arbitration clause in the contracts.
A total of 40 developers were prequalified to participate in the first round of the programme in 2015, but only nine of these signed power purchase agreements (PPAs) with EETC by the deadline in October 2016. Out of these nine, only the above three were able to successfully reach financial close under the conditions of the first round.
MEED reported in January that 31 developers were seeking to develop renewable energy projects in the second round of Egypts Feed-in-tariff (FIT) renewables programme.
The companies are planning to implement a combination of solar and wind projects under the FIT scheme, which would result in total investments of $3bn and 1,845MW of new capacity to the grid, according to local press reports citing the countrys electricity ministry.
The prospective projects would involve 23 developers establishing solar projects with a total capacity of 1,295MW. This would include 970MW in Banban, 180MW in El-Zafrana and 145MW in West Nile. According to the ministry, eight developers are seeking to develop wind farms with a total capacity of 550MW in the Gulf of Suez.
The news that more than 30 developers are participating in the FIT is positive news for Egypts ambitious renewable energy targets, with many in the renewable sector fearing that a significant number of companies would not be interested in the second round as tariff-prices were cut sharply from the first round.