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ACWA Power Plans To Invest $10 Billion In Egypt By 2026

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Egypt has been a strong advocate for increasing renewable energy production in order to reduce greenhouse gasses, improve air quality and increase opportunities for a gradual transition to sustainable energy.

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There was a substantial increase in the number of projects that generate electricity from solar and wind power. These projects were intended to feed green hydrogen production projects as well as seawater desalination and seawater desalination project. On the sidelines of the United Nations Conference of the Parties in Sharm El-Sheikh, in November, nine agreements were made between Egypt and major international alliances of energy companies in order to launch new projects within the field of renewable energies with investments exceeding $83bn.

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Paddy Padmanathan (Vice Chairperson, CEO, ACWA Power) expects that the group will invest up to $10 billion in Egypt by 2026. He stated that the group would invest approximately $1bn in 2023 and $3bn annually from 2024-2026.

He noted that the investments are not targeted at green hydrogen projects. In the event ACWA Power enters this sector, these investments could be significantly enlarged.

He stated that the Kom Ombo plant project, which has a production capacity of 200 megawatts of wind power, was the company’s most important project in Egypt for 2022. We are currently closing financial issues related to the project, with investments totaling about $300 million, and he pointed out that the project will be in force by the end of this year.

He stressed that the company is keen to work with Egypt’s energy sector to support the transition to sustainable and clean energy and to reduce carbon emissions.

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He said that negotiations are ongoing with large banks in the private and public sectors to obtain loans for financing projects in Egypt.

He said that the company had signed initial agreements for another project to generate 1.1 gigawatts of wind energy in the Gulf of Suez. The company is currently working on the agreement and will complete it early next year. This project’s investments are expected to exceed $1bn.

He said that the project would be undertaken in collaboration with Oman Investment Authority. Oman Investment Authority will have a 10% share. Hassan Allam Holding will have 25% of Egypt’s Sovereign Fund and 10% of Hassan Allam Holding, respectively. Saudi ACWA Power Company will hold the remainder, which will eventually become the larger wind farm by 2026.

He mentioned that there is a new project to generate electricity from wind energy. We are currently working with Egypt to allocate the land and begin work in 2024. Investments are estimated at $7-8bn.

He stated that the process of developing energy in the project would begin in 2024. He also explained that the construction of the project is not time-consuming, just as it is in renewable energy projects. This is because the development of the site, and all factors surrounding the project, is going to take around 18 months.

He explained that the company had started construction of its green hydrogen project with American companies “Air Products”, and Saudi NEOM. This is a major project in this sector, located in the city of NEOM. It expects to begin production in 2026.

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He stated that all three partners will own the project equally. The project will produce hydrogen, then export it to international markets for use as a biofuel to fuel transportation and communications systems. The project will also produce approximately 650 tonnes per day of green hydrogen and 1.2 million tonnes of green ammonia each year, with investments in excess of $6bn.

He said that the experience gained from all these projects qualifies them to develop more projects in this sector, particularly in Egypt’s green hydrogen sector.

He predicted that green hydrogen would be one of the major sources of renewable energy in Egypt, and around the globe. He pointed out that Egypt and Saudi Arabia have natural ingredients that allow them to lead green hydrogen projects due to the presence of sunlight and wind on most days.

He stated that the group is interested in investing in Egypt’s green hydrogen sector during the next period and will begin to study opportunities in this sector, particularly as it serves as a regional center for exporting renewable energy to Africa or Europe.

He said that Egypt has large electricity production capacities, but it is dependent on fossil fuels. This makes Egypt a promising market to develop renewable energy from the sun. He said that all we have to do is install solar panels and extract the energy, then sell it.

He forecast that green energy would be less expensive and more affordable over the next five years than conventional energy. He explained that Egypt has many countries and a platform that can sell renewable energy.

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Concerning the intention of the company to acquire stakes in Egyptian companies, he stated that ACWA Power is experiencing rapid growth through the launch of new projects that are based on its extensive experience in developing and exporting green and renewable energy. This is the true value of growth and not acquisitions.

He stated that the company is always looking to improve its production capabilities in current projects, as this is an important element of growth.

He noted that the company is a leader in many of its projects and that it invests part of its funds in addition to attracting investments to its side. The company will finish this year with investments exceeding $13bn and will continue to pump out investments with the same amount in the next year.

ACWA Power is currently operating in 13 countries in Africa, Central Asia, and Southeast Asia. It has a portfolio that includes 67 projects for energy production or water desalination, with an investment totaling $66.5bn.

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