12 July 2013 – The planned US$585.4 million Helwan South gas fired power station in Egypt has been approved by the World Bank. This 1,950 MW power station will contribute 10% of Egypt’s new electricity generation to be added by 2018 and help deliver a more reliable supply of electricity to the economy.
Egypt has experienced rapidly growing electricity demand due to population growth, development of energy-intensive industries, and the use of electrical household appliances particularly air conditioning, which has increased significantly in the last few years. Investments have not kept up with the annual 6% growth in demand and there have been rolling blackouts and service interruptions of up to 14 times a month. This has had a negative impact particularly on small enterprises and among consumers who have expressed wide dissatisfaction with the increased frequency of electricity outages.
“The World Bank is committed to helping Egypt rebuild public confidence in the power sector by supporting critical investments like Helwan South,” Inger Andersen, World Bank vice president for the Middle East and North Africa region, says.
The project is part of a broader program which aims to help the country deal with energy policy issues as well as meet the growing electricity demand in a sustainable manner. This includes investments in power generation, transmission and distribution, energy efficiency and subsidy reform. The infrastructure of the Helwan South power project includes a 1,950 MW supercritical steam technology power plant fuelled by natural gas and associated gas pipelines. The additional electricity generated by Helwan South will be distributed to grid-connected consumers throughout the country.
“The project is designed to improve the stability of the power system and reliability of electricity supply,” Hartwig Schafer, World Bank country director for Egypt, Yemen and Djibouti, says. “Helwan South will boost the use of cleaner fuel by utilising natural gas. It will displace older and less efficient generation and reduce emissions.”
The project will also provide short-term opportunities and long-term development needs. Around 4,000 jobs will be created, 75% during construction and the rest for plant operation and maintenance. In the broader economic context, Helwan South will help create indirect employment opportunities and boost economic growth.
The World Bank, the largest co-financier, has deepened its partnerships with several regional and international players to finance the Helwan South power project including: the Arab Fund for Economic and Social Development, Islamic Development Bank, Kuwait Fund for Arab Economic Development and OPEC Fund for International Development (OFID).
The World Bank is an important development partner in Egypt’s energy sector through policy dialogue and project financing in conventional and renewable energy generation scaling up the development of wind and solar power plants. The Global Environment Facility (GEF)-financed solar-thermal El-Kureimat power project in 2006 included the first concentrated solar power plant in Egypt and one of the first integrated solar-thermal power projects in the world. In 2010, the World Bank approved the Clean Technology Fund and IBRD-financed Wind Power Development Project to support the development of power transmission infrastructure to connect privately-financed wind power plants in the Gulf of Suez.