Fortescue Future Industries (FFI), an affiliate of the Australian iron ore company Fortescue Metals Group (FMG), has signed a memorandum of understanding with the Egyptian government to conduct studies in order to develop green hydrogen production in the country, including a project with a 9.2 GW installed capacity. The project would produce green hydrogen from solar and wind. The Egyptian government has also discussed cooperation with the Norwegian independent power producer Scatec to establish a 3 GW wind project in the country.
Finally, the European Bank for Reconstruction and Development (EBRD) is expected to help finance the closure of 5GW of inefficient gas-fired power plants in the country from 2023. The international financial institution plans to raise US$300m to stabilize Egypt’s grid, add battery storage, develop the local supply chain for renewables and retrain workers. EBRD also committed up to US$1bn for renewable energy, which would be about one-tenth of the private funding needed for 10 GW of mainly wind-powered projects planned by the government by 2028.
The country already signed several agreements to develop green hydrogen, including recently a memorandum of understanding in August 2022 signed with the independent power producer Globeleq to build a plant within the Suez Canal Economic Zone. The project will be developed in 3 phases, totalling 3.6 GW of electrolysers and around 9 GW of solar PV and wind power generation.
Renewables account for 10% of Egyp's installed capacity, with 2.8 GW of hydro, 1.7 GW of solar and 1.6 GW of wind. The country's capacity mix is dominated by thermal energy, including natural gas with a share of 80% (49.7 GW) and oil (10%, 6.2 GW). The 2035 Integrated Sustainable Energy strategy (2016) set a target of 20% of electricity production from renewables in 2022 and 42% for 2035, 25% of which from solar, 14% from wind, and 2% from hydropower. Most of the new capacity is expected to be delivered by the private sector.