ACWA Power, a leading Saudi developer, investor and operator of power generation and desalinated water plants in 13 markets, has finalised the project agreements for the 200MW Kom Ombo PV plant in Egypt.
The signing of the 25-year Power Purchase Agreement (PPA), Network Connection Contract and Usufruct Agreement was conducted via a virtual ceremony held with senior government officials and representatives from the Egyptian Electricity Transmission Company (EETC); The New and Renewable Energy Authority (NREA), and ACWA Power.
The agreements were signed by Eng. Sabah Mashaly, Chairman of EETC; Dr. Mohamed Al-KHayat, Chairman of NREA; Rajit Nanda, Chief Portfolio Management Officer and acting CIO of ACWA Power; and Eng. Hassan Amin, Country Development Director- Egypt, ACWA Power.
“Egypt is home to a wide range of untapped renewable resources particularly, wind and solar energy. The electrical capacities that can be generated from renewable sources can reach up to nearly 90 GW. In line with Egypt’s Integrated Sustainable Energy Strategy, our aim is to produce 42% of Egypt’s electricity using renewable sources by 2035. Currently necessary studies are being conducted to increase this percentage, stressing on maximizing the utilization of renewable energy in many areas, including water desalination and green hydrogen production,” H.E. Dr. Mohamed Shaker El Markabi, Egypt’s Minister of Electricity and Renewable Energy, stated.
“The signing of the final project agreements for Kom Ombo PV reflects our longstanding relationship with the Egyptian Electricity Transmission Company (EETC) and The New and Renewable Energy Authority (NREA), as well as our shared commitment to advancing the country’s renewable energy landscape and decarbonisation efforts. Playing a key role in accelerating the energy transition globally, ACWA Power is proud to be a trusted partner in supporting Egypt’s sustainability ambitions through environmental stewardship, social responsibility and good governance,” Paddy Padmanathan, President & CEO of ACWA Power, pointed out.
Financial closure of Kom Ombo PV is scheduled for the third quarter of 2021, following the obtainment of a USD 40 million senior debt financing and a USD 14 million equity bridge loan from the European Bank of Reconstruction and Development (EBRD), in addition to a USD 27.2 million loan from the African Development Bank (AfDB) to finance the construction, development and design of the 200 MW solar PV project.
“Finalising the project agreements for Kom Ombo PV, marks a significant milestone towards fulfilment of the project. The tariff is the lowest in the African continent for a project that is soon to achieve financial close and commence construction, which demonstrates that globally competitive tariffs are possible in North Africa and the wider African region, we remain on track to achieve commercial operation in Q3 2022, utilizing ACWA Power’s operational excellence and technological know-how in delivering electricity and desalinated water across the markets we serve,” Rajit Nanda, Chief Portfolio Management Officer and Acting Chief Investment Officer of ACWA Power, added.
The Government Guarantee for the project was signed in January 2021 between ACWA Power and Mohamed Maait, Egypt’s Minister of Finance. Kom Ombo PV is part of ACWA Power’s established energy portfolio and proven track record in Egypt, which currently includes three solar PV projects located in the Aswan province (Benban 1, Benban 2 and Benban 3) with an aggregate capacity of 120 MW, as well as the 2250MW Dairut-Luxor CCGT IPP in the Luxor Governorate.
Construction of the plant is expected to begin in the third quarter of 2021 and upon completion, Kom Ombo PV will cater to the power needs of 130,000 households and offset 336,000 tons of carbon dioxide per year.
Kom Ombo PV will be one of the largest privately developed utility scale solar plants in Egypt and will support the country in increasing its renewable energy capacity in line with the national targets to generate 22% of Egypt’s power from renewables by 2022 and 42% by 2035.