Published on March 22nd, 2015 | by Aisha Abdelhamid13
Egypt Fast Becoming A Hot Renewable Energy Market
March 22nd, 2015 by Aisha Abdelhamid
Originally published on Planetsave.
With ample natural resources to supply the renewable energy market, Egypt is finally finding its way to a cleantech future. Plagued with chronic shortages in electricity supply, a new, ambitious wind and solar procurement schedule is propelling the country forward. Released recently by Apricum–The Cleantech Advisory, a renewable energy market briefing anticipates Egypt assuming a position as a “renewable energy powerhouse” in the near future.
With around 90 million inhabitants, Egypt is the Arab World’s most populous country. Although recent political turmoil embroiled the country in revolution and counter-revolution, the turbulence has greatly subsided and social structures are stabilizing. As the second-largest economy in Africa, economic challenges have now become the focus of Egypt’s government and business leaders.
Egypt’s Projected Renewable Energy Growth
Stirring discontent, the frequency of electric blackouts are negatively impacting domestic life and industrial development. Urgently wishing to meet the soaring rate of power consumption with a stable supply, an additional 13 GW of capacity must be brought online in Egypt over the next five years. Solar and wind power in Egypt are anticipated to greatly help relieve this pressure. Thanks to a generous feed-in tariff (FIT) announced in September 2014, Egypt will procure 4.3 GW of solar and wind power production by 2017.
The incentive structures recently announced are considered both ambitious and credible. Egypt’s solar PV market and wind market are projected to grow cumulatively to approximately 2 to 3 GW each by 2020. Apricum reports that, with its “exceptional availability of solar and wind resources,” Egypt has earned “a spot on the global renewable power development hot list.”
Headquartered in Berlin, Apricum–The Cleantech Advisory offers strategy consulting services, market entry support, and transaction advisory. With offices in the USA, UK, Saudi Arabia, Mexico, Brazil, India, China, Turkey, South Korea, and Japan, Apricum focuses on assisting global clients to develop sustainable growth in renewable energy and clean technologies.
Explaining the ambitions behind Egypt’s new FIT, Apricum Project Manager Martin Mitscher stated in the recent briefing that Egypt’s next steps are crucial. As author of the briefing paper, Mitscher recognizes that the Egyptian government must equally harness market enthusiasm, as well as the country’s significant solar and wind resources.
“After the FIT announcement,” said Mitscher, “we saw a rush from local and international solar developers to get their foot in the door. A stunning 178 project proposals were submitted for more than double the announced capacity of 2 GW.” Local firms as well as many international renewables industry major players have been attracted by the FIT. Of the 178 proposals, 69 projects achieved qualification. Potential lenders must now be provided a financial framework by the Egyptian government to facilitate satisfactory terms of finance for developers.
Egypt “On the Hot List of Global Renewable Power Developers”
Poised to grow a significant renewable energy market in the near term, Mitscher believes Egypt is “exhibiting the necessary key drivers of rapidly growing power demand, exceptional availability of solar and wind resources, and the need to reduce domestic fossil fuel consumption.” Mitscher reports, “Egypt is definitely on the hot list of global renewable power developers at the moment.”
As the initial 2.0 GW target for wind power on the first procurement round was not fully reached, a second procurement round is expected sometime before July, 2015. Additionally, in the private sector there is already 720 MW of combined capacity under construction, due to the recent establishment of a merchant IPP scheme.
“With well-managed implementation,” summarizes Project Manager Mitscher of Apricum, “Egypt could become one of the leading renewable energy markets in the MENA region in a short space of time.”