Engie and Scatec secure land for 8 GW of wind power in the Egyptian desert

10 05 2024 | 07:30 Jean Marie Takouleu

Two major players on the Egyptian energy scene have secured land for the deployment of 8 GW of wind power. Scatec and Engie will carry out these projects in the western governorate of Sohag.

Egypt is preparing to become one of Africa’s leaders in wind energy. To achieve this, Cairo will be relying primarily on private investment. As part of this strategy, the New and Renewable Energy Authority (NREA) has just granted land for two projects led by private companies.

The signing ceremony took place recently in the presence of Mohamed Shaker, Egypt’s Minister of Electricity and Renewable Energy, and Hilde Klemetsdal, Norway’s Ambassador to Egypt. Together with Scatec, NREA Chairman Mohamed El-Khayat signed the land permit for the development of 5 GW of wind power generation capacity. Egypt’s flagship Orascam Construction has signed a contract for 3 GW of wind power, which it will develop as part of a consortium that also includes French energy company Engie and Japan’s Eurus Energy.

Supporting the energy transition

These two projects could inject a combined capacity of 8 GW into the Egyptian Electricity Transmission Company (EETC) grid. According to NREA, the two projects, which represent an investment of $9 billion, will also offset the emissions of 17 million tonnes of CO2 equivalent per year. The first memorandums of understanding for the development of these major projects were signed at COP27, which Egypt hosted in 2022.

For Minister Mohamed Shaker, the implementation of these two large-scale projects will contribute to the national objective of producing 42% of electricity from renewable energies by 2030, enabling Egypt to reduce its dependence on natural gas, the price of which has fluctuated greatly on the international market in recent years, first during the post-Covid-19 recovery, and then after the start of the war in Ukraine.

Impact on biodiversity to be monitored

By 2022, Egypt was generating 90% of its electricity from gas and oil, according to energy think tank Ember. Compared with its North African neighbours, however, Egypt has made significant progress in its energy transition, thanks to independent power producers (IPPs) such as Scatec, which boasts 380 MW of installed solar capacity.

The Engie-Orascom Construction-Eurus Energy consortium already operates a 262 MW wind farm in the Gulf of Suez. In the same region, the three partners are currently building a 500 MW wind farm. Massive investment in onshore wind power is raising fears about the impact on biodiversity, particularly migratory birds that leave Europe to spend the winter in Africa. In response to the constant warnings from certain media, including Afrik21, some international donors, such as the European Bank for Reconstruction and Development (EBRD), are now making their loans for these vast development projects conditional on biodiversity being taken into account.