ACWA Power signs deal worth up to USD 1.5 billion that will provide power to over 1 million households.
ACWA Power, a Saudi power generation, green hydrogen and desalinated water developer, has signed a deal to develop a 1.1 GW wind project in Egypt, worth an estimated USD 1.5 billion. The signing ceremony took place at the offices of the Egyptian General Authority for Investment and Free Zones, in Cairo. The consortium also includes Egypt’s Hassan Allam Holding and the parties will work together on the development phase of the project to complete the site studies and secure financing.
The Middle East’s “largest wind farm”
Located in the Gulf of Suez and Gabal el Zeit area, according to ACWA Power, the project represents the largest wind farm in the Middle East and one of the largest offshore wind farms in the world.
“We are honored to contribute to the strengthening ties of Saudi Arabia, our home, and Egypt via this milestone wind project, and extend our sincerest gratitude to the leaders of both countries in entrusting their faith in our abilities to realize their renewable energy mandates,” said Mohammad Abunayyan, chairman of ACWA Power.
Powering over 1 million households
According to estimates, the project will offset 2.4 million tons of Co2 emissions annually and provide power to 1,080,000 households. The project is part of Egypt’s commitment to use renewable energy to reduce the impact of carbon emissions. It also represents the government’s attempts to secure investment in the country’s energy sector by working alongside private companies and attracting investment from foreign sources. The Egyptian government has said that it expects to see investments of USD 8 billion in the country’s energy sector in 2022 with significant investments in green power.
“The project marks an important milestone in Egypt’s plans to decarbonize the energy sector and meet its targets under the country’s Intended Nationally Determined Contributions. We are proud to be part of this flagship project and look forward to a fruitful partnership,” said Dalia Wahba, deputy chief executive and chief investment officer of Hassan Allam Utilities.
Diversification of energy
The project is a leading example of the Egyptian government’s efforts to increase the participation of the private sector in implementing green energy projects in Egypt as well as attracting investments from international, Arab and local companies into the country.
“This milestone wind project falls within the framework of the Egyptian government’s strategy to diversify its energy sources and leverage the country’s rich natural resources, especially in renewable energy” said Dr. Mohamed Shaker El-Markabi, Egypt’s Ministry of Electricity and Renewable Energy. “The Ministry of Electricity and Renewable Energy is taking concrete actions to ensure the resilience of our energy strategy, because of the escalating changes that the world is witnessing, which aim to increase the contribution of renewable energy to up to 42 percent by 2035.”
According to a recent report, MENA energy investments are set to reach USD 879 billion by 2026. Green energy is set to rise, the use of oil will fall and gas will remain static, according to the report by Apicorp.
ACWA Power’s third investment
The project is ACWA Power’s third – and first wind farm – in Egypt, following the 120 MW Ben Ban solar power projects in the Aswan region and the 200MW Kom Ombo solar plant. The new plant will be commercially operational by the end of 2026.