Meed | EBRD invests in 1.1GW Egypt wind farm

EBRD invests in 1.1GW Egypt wind farm

23 January 2024

The European Bank for Reconstruction & Development (EBRD) will invest $75m in equity in the Netherlands-based subsidiary of Egypt's Hassan Allam Utilities, which is co-developing a wind independent power producer (IPP) scheme in the North African country.

HAU Energy is a funding vehicle incorporated in the Netherlands to develop and operate renewable energy projects in Egypt and Africa.

"The EBRD investment will raise capital for the development and construction of renewable energy projects in the region, including HAU's most imminent project, namely the 1.1GW Gulf of Suez wind farm in Egypt," the bank said in a statement.

A consortium of Saudi Arabia-based utility developer Acwa Power and Hassan Allam recently signed a 25-year land usufruct agreement with Egypt's New & Renewable Energy Authority (NREA) for the 1,100MW wind IPP, which will be located in the Gulf of Suez and Gabal el-Zeit area.

The project agreements were initially signed in June 2022.

Acwa Power said at the time that the consortium will work during the development phase to complete the site studies and secure financing for the project, which will require an investment of $1.5bn.

The wind project is expected to reach financial close by the third quarter of 2024 and be commercially operational by the end of 2026.

The IPP project will use wind turbines with blade heights of up to 220 metres to achieve the most efficient use of the designated land plots.

The project is designed to mitigate the impact of 2.4 million tonnes of carbon dioxide emissions annually and provide electricity to 1,080,000 households when complete.

Gas scheme replacement

It is understood that the 1,100MW wind IPP is a replacement for the previously planned 2,300MW IPP in Luxor.

A consortium of Acwa Power and the local Hassan Allam signed the power purchase agreement with the Egyptian Electricity Transmission Company for the planned Luxor IPP in November 2018.

The original gas-fired IPP scheme, which required a total investment of $2.3bn, was expected to enter commercial operation in 2023. The date was later extended to 2024 before the project was cancelled and replaced.

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Jennifer Aguinaldo