Scatec and Engie, two prominent entities in the Egyptian energy sector, have acquired land in the western governorate of Sohag to implement wind power projects totaling 8 GW.
Egypt is preparing to become one of Africa’s leaders in wind energy. To achieve this, Cairo will be relying primarily on private investment. As part of this strategy, the New and Renewable Energy Authority (NREA) has just granted land for two projects led by private companies.
The signing ceremony took place recently in the presence of Mohamed Shaker, Egypt’s Minister of Electricity and Renewable Energy, and Hilde Klemetsdal, Norway’s Ambassador to Egypt. Together with Scatec, NREA Chairman Mohamed El-Khayat signed the land permit for the development of 5 GW of wind power generation capacity. Egypt’s flagship Orascam Construction has signed a contract for 3 GW of wind power, which it will develop as part of a consortium that also includes French energy company Engie and Japan’s Eurus Energy.
These two projects could inject a combined capacity of 8 GW into the Egyptian Electricity Transmission Company’s (EETC) grid. According to NREA, the two projects, which represent an investment of $9 billion, will also offset the emissions of 17 million metric tons of CO2 equivalent per year. The first memoranda of understanding for the development of these major projects were signed at COP27, which Egypt hosted in 2022.
For Minister Mohamed Shaker, the implementation of these two large-scale projects will contribute to the national objective of producing 42% of electricity from renewable energies by 2030, enabling Egypt to reduce its dependence on natural gas, the price of which has fluctuated greatly on the international market in recent years, first during the post-Covid-19 recovery and then after the start of the war in Ukraine.
By 2022, Egypt was generating 90% of its electricity from gas and oil, according to energy think tank Ember. Compared with its North African neighbors, however, Egypt has made significant progress in its energy transition, thanks to independent power producers (IPPs) such as Scatec, which boasts 380 MW of installed solar capacity.
The Engie-Orascom Construction-Eurus Energy consortium has already commenced operations on a 262 MW wind farm in the Gulf of Suez and is currently constructing a 500 MW wind farm in the same region. The significant investment in onshore wind power is sparking concerns regarding its impact on biodiversity, particularly migratory birds traveling from Europe to Africa for the winter. Responding to persistent warnings from various media outlets, including Afrik21, certain international donors like the European Bank for Reconstruction and Development (EBRD) are now stipulating that their loans for these extensive development projects are contingent upon biodiversity considerations.
