EBRD-Backed Grid Upgrade To Drive Egypt’s Renewable Push With €200 Million Investment

The European Bank for Reconstruction and Development (EBRD) is supporting Egypt’s move towards a greener economy by providing a €200 million financing package to the Egyptian Electricity Transmission Company (EETC). This support focuses on strengthening Egypt’s electricity transmission network so it can handle rising power demand and integrate large amounts of renewable energy planned for the coming years.

The financing package includes an EBRD loan of up to €165 million, along with an investment grant of up to €35 million from the European Union Neighbourhood Investment Platform. This makes it one of Egypt’s first major grid investments under a broader EETC investment programme linked to the energy pillar of the Nexus of Water, Food and Energy (NWFE) programme. The NWFE programme was launched in 2022 to support Egypt’s national climate goals by bringing together climate finance and private investment.

Investment in Egypt’s grid infrastructure has become urgent due to steady growth in peak electricity demand and the country’s ambitious renewable energy plans. The new financing will allow EETC to enhance and reinforce the national transmission system, starting with the upgrade of a 500 kV substation in the Cairo governorate. This upgrade is important for maintaining network stability and is directly linked to the planned decommissioning of the gas-fired Shoubra El Kheima power plant, one of several thermal power plants set to be retired under the NWFE programme.

In addition to the substation upgrade, the financing will support the construction of a high-voltage overhead transmission line. This line will evacuate more than 2.1 GW of renewable energy from the Gulf of Suez region, an area central to Egypt’s renewable energy development. By enabling more renewable power to enter the grid, the project will help Egypt reduce energy costs and support the planned phase-out of energy subsidies.

Together, the two subprojects are expected to reduce transmission losses in Egypt’s power system and cut annual carbon emissions by 22,584 tonnes of CO₂ equivalent. These reductions contribute directly to Egypt’s climate commitments and its goal of building a more efficient and resilient energy system.

Senior government officials highlighted the importance of the investment. Egypt’s Minister of Planning, Economic Development and International Cooperation, H.E. Rania A. Al-Mashat, said the project reflects the strength of Egypt’s partnership with the EBRD and the European Union under the NWFE programme. She noted that blended finance is helping Egypt mobilise resources at scale, modernise its electricity grid, increase efficiency, and advance climate goals while supporting sustainable economic growth.

The Minister of Electricity and Renewable Energy, H.E. Mahmoud Esmat, described the investment as a crucial step in Egypt’s green transition. He said modernising the national grid is essential to integrating the 22 GW of renewable energy capacity targeted by 2030. According to him, the project shows Egypt’s commitment to reducing reliance on fossil fuels, improving grid stability, and strengthening its position as a regional hub for green energy and related products.

The European Union also underlined its support for Egypt’s clean energy plans. Ambassador Angelina Eichhorst, Head of the EU Delegation to Egypt, said the EU-backed transmission project is driving Egypt’s renewable energy expansion. She noted that this project builds on earlier work involving 800 km of transmission lines and substations, and that further projects are planned to support Egypt’s clean energy future.

From the EBRD’s side, First Vice President Greg Guyett welcomed the agreement as another milestone in cooperation under the NWFE platform. He said modernising power systems is key to advancing renewable energy and optimising energy costs, and that Egypt is taking important steps towards building the energy system of the future.

Egypt has been a founding member of the EBRD, and since the bank began operations in the country in 2012, it has invested more than €13.8 billion across 209 projects. This latest financing further strengthens that long-term partnership while supporting Egypt’s transition to a cleaner and more sustainable energy system.