ACWA Power, a Saudi developer of energy and desalination projects, announced on April 7 that it has finalized its agreement with the Egyptian government to build the 200MW Kom Ombo PV power plant. At a virtual event, both parties signed a 25-year PPA and a network connection contract. The attendees were the representatives from ACWA, the Egyptian Electricity Transmission Company (EETC), and Egypt’s New and Renewable Energy Authority.
The main backers of the project are the European Bank for Reconstruction and Development (EBRD) and the African Development Bank. The former has provided a senior debt financing of US$40 million and an equity bridge loan of US$14 million, while the latter has provided a loan of US$27.2 million. Other sources of financing include the OPEC Fund for International Development, Arab Bank, and the Green Climate Fund. The financial closure is scheduled for this third quarter. EBRD currently estimates that the total cost of the project will reach US$155.4 million.
Located about 800km away from Cairo in Aswan Governorate, the Kom Ombo PV power plant is set to begin commercial operation in the third quarter of 2022. Once up and running, the power plant is expected to meet the electricity demand of approximately 130,000 households. ACWA has already participated in the development of three other solar projects in Aswan Governorate. The company also operates in other African countries including Ethiopia, Morocco, and South Africa.
It should also be pointed out that ACWA does not limit itself to the development of renewable energy projects. According to reporting from energy news outlets, the company is also in negotiation with EETC to build a 2.25GW CCGT power plant in Luxor Governorate.
Egypt has an abundance of hydropower, wind power, and solar energy. The potential of building solar parks and wind farms is huge in the country due to advantages such as lots of open spaces, high wind speeds, and favorable climate conditions. Mohamed Shaker El Markabi, who serves as Egypt’s Minister of Electricity and Renewable Energy, said that the total domestic renewable generation capacity could reach up to almost 90GW, given the currently available resources.
The Egyptian government has launched the 2035 Integrated Sustainable Energy Strategy to diversify the country’s energy mix. The plans calls for raising the share of the domestic electricity supply produced by renewable generation to 20% by 2022 and 42% by 2035. The minister added that the government is studying various options to achieve this target.