Egypt Secures Financing for 2007-12 Electricity Generation Plan

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Egyptian electricity sector has a five-year plan for 2007-12 that is designed to add 9,200 megawatts (MW) to the generation capacity of the Egyptian national grid by building numerous power plants that will employ a variety of technologies. The Ministry of Electricity hopes to complete construction in time to meet the 7% local demand and achieve sustainability in electricity generation.

The Egyptian electricity sector secured funding for the projects by applying for loans from international banks and financing agencies. In the first week of this month, Minister of Electricity Dr. Hassan Yunis announced that the World Bank agreed to contribute $870 million toward two important projects: $600 million for the North Giza 1,500-MW power plant, $100 million for the Kom Ombo solar project, and a $170 million soft loan.

The minister said that the World Bank is supporting renewable energy projects in Egypt, where it is now evaluating an agreement to finance projects for plants that use wind power. The World Bank's Clean Technology Fund also contributes to the financing of the advisory services necessary to prepare for private-sector participation in the construction of windfarms through tenders in a competitive system based on the build-own-operate method, in addition to financing projects for transmission lines to link windfarms to the electricity grid.

Yunis said that cost estimates for the Ain Sukhna 1,300-MW steam power plant were about $1.75 billion. A number of international financial institutions and Arab funds are involved in financing the foreign component of the project including the African Development Bank, the Arab Fund for Economic and Social Development, the Kuwaiti Fund and the World Bank, based the performance of these institutions in electricity sector projects and in the Egyptian economy.

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