Economics Driving Egypt To Renewables

The population of the Arab Republic of Egypt is approximately 104.14 million people[1]. In 2018, 100% of the people in this northeast African country had  access to electricity[2].

In 2019, Egypt’s economy was ranked 40th in the world in gross domestic product (GDP)[3]. The country’s economy is dependent on the export of crude petroleum, refined petroleum, gold, natural gas, fertilizers, clothing, fruits, and vegetables.

In 2016, Egypt signed the Paris Climate Agreement[4], committing to “high CO2 mitigation levels” by phasing out energy subsidies by 2021.  Egypt also committed to the development of new zero-carbon emission power plants.

In 2019, the state-owned electric company, Egyptian Electric Holding Company (EEHC) used natural gas (54.6%), oil (38.7%), renewable energy (4.6%), and coal (2.1%) to generate electricity in the country[5]. Hydropower, biomass, and solar are the primary sources of renewable energy in Egypt.

In 2020, the Egyptian government announced the 2035 Integrated Sustainable Energy Strategy, which emphasizes the importance of renewable energy. The government’s goal is to increase the supply of electricity from renewable sources to 20% by 2022 and 42% by 2035.

Recent utility scale, renewable energy projects in Egypt include:

  • 50 MW Solar Project – In April 2021, German solar company, Belectric commenced work on a solar project in the town of Zaafarana, located approximately 100 miles southeast of the capital, Cairo. The project is forecast to be commissioned in 2022.
  • 200 MW Solar Project Saudi Arabian company, Acwa Power is continuing work on the Kom Ombo solar photovoltaic power plant, located approximately 325 miles south of Cairo. The project is scheduled to be commissioned in Q-3 2021.
  • 250 MW Wind Project – Dutch renewable energy company, Lekela Power is continuing work on the West Bakr wind farm, located approximately 150 miles southeast of Cairo. The project is scheduled to be commissioned by year-end 2021.
  • 252 MW Wind Project – Danish wind turbine company, Vestas is continuing work on the Gulf of Suez 1 wind project, located approximately 150 miles southeast of Cairo. The project is scheduled to be commissioned in 2023.
  • 500 MW Wind Project – German multinational, Siemens AG is continuing work on the Red Sea Wind Energy Project, located in the Gulf of Suez, governorate of the Red Sea.

Why is Egypt suddenly developing major wind and solar projects? Economics pure and simple. The export of oil and natural gas is a major source of revenue for Egypt.

Egypt has significant renewable energy resources, including solar, wind, hydropower, geothermal, and biomass. The country’s renewable energy resources can easily meet the country’s current and future power requirements.  The Egyptian government’s goal is to use renewable energy for domestic power, while preserving oil and natural gas for foreign export.

 Jack Kerfoot

Website – “Our Energy Conundrum”

www.jackkerfoot.com

 

[1] Egypt Africa Population (2020) –  June 7, 2021 www.worldometers.info

[2] Egypt – The World Bank Group

[3] Gross Domestic Product 2019 – World Bank DataBank

[4] Carbon Brief “Paris 2015: Tracking Country Climate Pledges”

[5] BP Statistical Review of World Energy – Egypt

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