Egypt signs $40bn deals to develop green energy sector

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Egypt has signed seven agreements with global companies to develop green hydrogen and renewable energy projects in the Suez Canal Economic Zone, with expected investments worth $40 billion over 10 years.

Investment of nearly $12 billion is expected for a pilot phase, followed by another $29 billion for the first phase, the government’s information department said, citing Hala El-Said, minister of planning and economic development.

The developers signing the agreements include the UK’s Pash Global, Switzerland’s Smartenergy, Egypt’s Gamma Construction, a consortium between South Korea’s SK Eco Plant and China’s CSCEC North Africa, Egypt’s Gila Al Tawakol Electric, Canada’s AmmPower and Hong Kong’s United Energy Group.

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El-Said said the agreements are a new step for the Sovereign Fund of Egypt, which launched the first integrated green ammonia production plant in Africa in November. The minister chairs Egypt’s sovereign fund.

The fund seeks to promote Egypt as a regional centre for green energy, reinforced by the investment incentive packages launched by the government.

Ayman Soliman, CEO of the Sovereign Fund of Egypt, said he has received continuous and increasing interest from investors in green hydrogen projects without giving further details.

Last October, Egyptian Prime Minister Mostafa Madbouly confirmed that a draft law on incentives for green hydrogen projects and their derivatives had been referred to the parliament.

“We have doubled the incentives provided and allocated to green hydrogen, including a draft law on incentives for green hydrogen projects and its derivatives, which has been referred to Parliament and is expected to be issued this year,” he added.

Cairo expects foreign direct investment of $35 billion over the next five years as the government aims to boost economic growth.

The government intends to attract around $12 billion in foreign direct investment in 2023/2024, with a projected annual increase of 15 percent and 20 percent, said General Authority of Free Zones and Investment chairman Hossam Heiba.