print logo
The Ministry of Electricity and Renewable Energy plans to increase the amount of power generated from renewable energy sources from 12% to 22% by 2022
01.12.16 | Interesting article at Oxford Business Group

In a bid to boost Egypt’s power generation capacity, government officials are looking to increase production from solar and other renewable energy sources.

To this end, the Ministry of Electricity and Renewable Energy (MERE) has laid out a plan to increase the amount of power generated from renewable energy sources from the current level of 12% to 20% by 2022.

Solar on the rise

In November the government announced it had signed power-purchase agreements (PPAs) worth some €600m ($662m) for approximately 400 MW of solar power capacity.

Among the eight companies awarded contracts are Saudi Arabia's FAS Energy and local developers ARC For Renewable Energy, Infinity Solar Systems and ELF Energy Egypt, of the 100 companies eligible for Egypt’s feed-in-tariff (FIT) scheme.

FITs establish set rates for the purchase of energy production, often providing favourable terms to encourage investment in targeted segments such as photovoltaic (PV) solar and wind projects.

The rollout of solar projects has been slowed by the devaluation of the Egyptian pound in March, with the currency sinking by 13% to LE8.95:$1, before being floated in early November. With PPAs originally signed in the local currency during the first phase of the FIT scheme beginning in 2014, international developers and lenders have shied away from the contracts, which partly explains why the awards have largely gone to smaller local players.