Work on Egypt’s Planned $1.1 GW Wind Farm to Begin Early Next Year

Saudi Arabia’s ACWA Power and Hassan Allam Holding, one of the reputed companies in Egypt and the Middle East and North Africa (MENA) region, will start construction of one of the largest wind farms in the region in 2024.

The two companies are expected to break ground on the 1.1 GW wind farm, costing $1.5 billion, in the Gulf of Suez early next year and it will take three years to complete the project in two phases, Arabic daily Al Mal, citing officials of the ACWA Power, said.

It may be recalled that ACWA Power and Hassan Allam Holding signed a 25-year power purchase agreement with the Egyptian Electricity Transmission Company (EETC) in June 2022 to develop the project under a build-own-operate framework.

The companies will be raising close to 75% of the project cost through loans and the remainder will be self-financed by the investors. The project is expected to reach financial close by 4Q 2024, the daily said.

Among the possible investors, the European Bank for Reconstruction and Development (EBRD) is eyeing a potential investment in the Suez facility. The Sovereign Fund of Egypt (SFE) also expressed last year interest in potentially acquiring a 10% stake.

Even the UAE’s Masdar signed a land allocation agreement with the Electricity Ministry earlier this year for a planned 10 GW mega wind farm. That farm and a separate 10 GW facility being built by Masdar, Infinity and Hassan Allam will each be the world’s largest wind farms when complete. In parallel, Scatec is also looking to build a 5 GW wind farm in Egypt.

ACWA, which is already a significant player in Egypt’s renewable sector, and its 200 MW Kom Ombo solar power plant secured $114 million in April this year in backing from a consortium of global lenders led by the EBRD.

The company also has minority stakes in three plants in the 1.8 GW Benban project, said to be Africa’s largest solar park near Aswan in Egypt, and an upcoming project with the EETC to convert an electricity plant in Luxor to renewable energy.

The Benban solar park is spread over an area of 37 sq km and has been connected to Egypt’s National Grid since 2019. It was developed in line the Egyptian New and Renewable Energy Authority’s (NREA) agenda. The project comprises 41 solar power plants and was built to the tune of $4 billion by 30 companies.

Egypt’s RE Projects

Egypt, which has drawn up ambitious big renewable projects to meet the growing for electricity in the country, has set a target of 42% of the country’s energy mix by 2030 instead of 2035 and upgraded its emissions reduction goal to 80 million tons (MTs) by 2030 from a previous goal of 70 MTs. The government is aiming to produce 42% of its energy from renewable sources by 2030 and 60% by 2040.

The other renewable projects in Egypt include Gabal Al-Zait wind farm (580 MW), the state-owned Zafarana wind farm (545 MW), Gulf of Suez wind farm (262 MW), Kuraymat Solar Thermal Power Plan (150 MW), Siwa Solar Project (10 MW).