HomeIndustry SectorsFinance and PolicyEgypt’s largest solar plant, Kom Ombo, receives $114 million

Egypt’s largest solar plant, Kom Ombo, receives $114 million

Egypt’s largest solar plant, Kom Ombo has received $114 million financing package from the European Bank for Reconstruction and Development (EBRD), the OPEC Fund for International Development (OPEC Fund), the African Development Bank (AfDB), the Green Climate Fund (GCF) and Arab Bank.

The financing package with ACWA Power is for the construction of the largest private solar plant in Egypt.

The development of the Kom Ombo solar plant will add 200MW of energy capacity, increasing the share of renewable energy in Egypt’s energy mix and further promoting private-sector participation in the Egyptian power sector.

The package comprises loans of up to $36 million from the EBRD, $18 million from the OPEC Fund, $17.8 million from the AfDB, $23.8 million from the GCF and $18 million from Arab Bank. This is in addition to equity bridge loans of up to $14 million from EBRD and $33.5 million from Arab Petroleum Investments Corporation (APICORP).

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Final project agreements on 200MW Kom Ombo PV plant in Egypt signed

The new Kom Ombo plant will be located less than 20km from Africa’s biggest solar park, the 1.8GW Benban complex. Once operational, the new utility-scale plant will serve 130,000 households.

ACWA Power submitted the lowest tariff in what was the first solar photovoltaic (PV) tender in Egypt. The provision of solar energy through a public tendering process aims to achieve a competitive tariff and promote the growth of solar energy as an affordable alternative to conventional energy sources.

Private-sector participation in the Kom Ombo project is the result of successful policy dialogue with the Ministry of Electricity and Renewable Energy and the Egyptian Electricity Transmission Company (EETC), as well as a $3.6 million technical assistance programme, co-funded by the EBRD and the GCF, to support the EETC in administering competitive renewable energy tenders.

In addition, the project has also benefitted from broader energy-sector reforms supported by the AfDB in recent years to scale up the involvement of the private sector.

Egypt
The European Bank for Reconstruction and Development), the OPEC Fund for International Development, the African Development Bank, the Green Climate Fund and Arab Bank signed financing package with ACWA Power for the construction of the largest private solar plant in Egypt. Image: AfDB

Kom Ombo partnership signals new partnership era

EBRD President Odile Renaud Basso, said: “We are very happy to team up again with ACWA Power in Egypt, after our successful partnership in Benban, to promote renewable energy in Egypt. Increasing the production of clean energy is an important step to reducing carbon emissions and addressing climate change.”

OPEC Fund Director-General Abdulhamid Alkhalifa, said: “We are pleased to contribute to Egypt’s efforts and strategy to expand its generation capacity in the renewable energy space. Kom Ombo will be our third project with ACWA Power and it exemplifies great cooperation between government, development finance and private-sector actors.”

The African Development Bank’s Vice President in charge of Power, Energy, Climate Change and Green Growth Kevin Kariuki, said: “The Kom Ombo solar project is a truly remarkable transaction. It not only clearly demonstrates the indisputable competitiveness of solar PV vis-à-vis conventional sources of generation, but it also directly contributes towards the realization of Egypt’s ambitious renewable energy targets, in addition to being an excellent example of what stakeholders driven by a shared objective can achieve.”

Paddy Padmanathan, President and Chief Executive Officer of ACWA Power, said: “ACWA Power is privileged and proud to lead the realisation of the Kom Ombo PV project. Kom Ombo PV is the fourth project in ACWA Power’s Egyptian portfolio and the conclusion of this financing demonstrates the confidence in the Egyptian government’s ambitious renewable energy plans, being implemented through private-sector participation.”

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200MW PV solar power plant to be constructed in Upper Egypt

Yannick Glemarec, Executive Director of the Green Climate Fund, said: “The GCF is proud to support implementation of Egypt’s ambitious renewable energy financing framework. $154.7 million in GCF resources, including $23.8 million for the Kom Ombo plant, catalyses over $850 million in co-financing and unleashes the first wave of private renewable energy projects in Egypt. The GCF looks forward to continuing to support the government of Egypt in delivering on its ambitious climate targets through innovative partnerships with the private sector.”

Nemeh Sabbagh, CEO of Arab Bank, said: “Green financing is one of our strategic focus areas and Egypt is a core market for Arab Bank Group, where we have been operating since 1944.”

The Kom Ombo plant will contribute to the Egyptian government’s target to generate 42% of the country’s electricity from renewable energy sources by 2035 while delivering one of the lowest generation tariffs on the continent.

Nomvuyo Tena
Nomvuyo Tena is a Content Producer at Clarion Events Africa and is as passionate about the energy transition in Africa as she is about music and Beyonce.

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