The financing tools include grants, debt swaps, technical assistance, project rehabilitation, credit guarantees, private sector investments, and concessional financing. Their purpose is to support the deployment of 10 GW of renewables which will replace 5 GW of thermal power stations and help Egypt reach a 42% renewables share in its power mix by 2030.
So far, the North African country has launched the implementation of renewable energy projects with a combined capacity of 3.7 GW as part of the programme, Egypt's Ministry for International Cooperation said on Monday.
The announcement was made during a meeting chaired by minister Rania Al-Mashat and attended by electricity minister Mohamed Shaker as well as representatives of the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), German development bank KfW and other institutions. The aim of the meeting was to review the progress made in transitioning from commitments made during the COP 27 summit in Sharm El-Sheikh last year to their implementation.
So far, the EBRD has mobilised USD 2 billion in funding from the private sector for the NWFE projects, in addition to concessional grants and financing, said Heike Harmgart, EBRD Managing Director for the Southern and Eastern Mediterranean region. These investments include wind and solar energy projects in the Gulf of Suez, as well as projects supporting the modernisation of the transmission and distribution network.
Al-Mashat noted that Germany has already signed a EUR 54 million tranche out of a total of EUR 104 million in commitments for the development of projects. This will support the grid connection of two 500-MW wind farm projects.
In addition, the director of the French Development Agency in Egypt, Clemence Vidal, affirmed the agency's commitment to providing EUR 100 million in blended finance to support the private sector. The NWFE projects are supported also by the EIB, which aims to mobilise EUR 1.3 billion, and by the EU with EUR 35 million. The targeted 10 GW of renewables are expected to save about USD 1.2 billion in costs annually, which is spent on the fuel needed to operate thermal power stations.