After signing a US$123 million financing package, ACWA Power, a prominent Saudi developer, investor, and operator of power generation, water desalination, and green hydrogen plants worldwide, can begin construction on the 200MW Kom Ombo project, Egypt’s first utility-scale solar power plant.
The European Bank for Reconstruction and Development (EBRD), the Organization of the Petroleum Exporting Countries Fund for International Development (the OPEC Fund), the African Development Bank (AfDB), the African Development Bank’s Sustainable Energy Fund for Africa (SEFA), the Green Climate Fund (GCF), the Arab Petroleum Investments Corporation (APICORP), and the Arab Bank are all contributing to the project’s funding.
The EBRD will lend up to US$36 million, the OPEC Fund will lend up to US$14.6 million, the AfDB will lend up to US$14.4 million, the GCF will lend up to US$34.5 million, the Arab Bank will lend up to US$14.8 million, and the SEFA will lend up to US$10 million, all as part of the COVID-19 IPP relief program. The European Bank for Reconstruction and Development (EBRD) and the Arab Petroleum Investments Corporation (APICORP) have provided equity bridge loans totaling US$45 million for the project.
CEO of ACWA Power, Marco Arcelli, commented on the newly signed contract :
”ACWA Power’s successful acquisition of financing support for our renewable project is a significant milestone. We’re fully committed to fast-tracking the project’s development while staying true to Egypt’s renewable energy targets”.
“The Kom Ombo solar project further demonstrates the private sector’s active involvement in Egypt’s energy transition. This accomplishment highlights the shared vision and purpose of various global financing institutions in achieving the Republic’s targets, which would not be possible without the trust and support of the government, the Egyptian people, and communities.” he added.
Arcelli emphasised that “The new financing package is a result of the confidence that major institutions have in our proven track record of developing large-scale projects. With this funding, we are fully committed to working collaboratively with our partners in the public and private sectors to ensure that this project delivers a strong and sustainable outcome for all involved.”
”We are delighted to reach this important milestone and deepen our partnership with ACWA Power as we promote renewable energy in Egypt, and indeed in Africa. Expanding clean energy generation is central to low-carbon development on the continent and contributes to further reducing carbon emissions and achieving of the goals of Paris Agreement. This is in line with the AfDB’s strategy to promote green growth in Africa. Kom Ombo Solar is also our first collaboration with EBRD, and OPEC Fund in Egypt and we look forward to many more successful partnerships as we seek to enhance more co-financing opportunities across the continent” said Kevin Kariuki, The African Development Bank’s Vice President in charge of Power, Energy, Climate Change and Green Growth.
Successful policy dialogue between the Ministry of Electricity and Renewable Energy and the Egyptian Electricity Transmission Company (EETC) paved the way for private sector participation in the Kom Ombo project, as did a US$3.6 million technical assistance programme, co-funded by the EBRD and the GCF, to assist the EETC in administering competitive renewable energy tenders. The project has also benefited from AfDB-backed energy sector reforms that have increased the private sector’s involvement over the past few years.
”We are proud to support the financing of this highly strategic project. The Kom Ombo project is the first tendered utility-scale solar project in Egypt, and one of the first to be delivered under the Energy Pillar of the Nexus Water-Food-Energy (NWFE) initiative, whereby the Egyptian authorities are committed to developing 10 GW of new renewable energy projects and decommissioning 5 GW of thermal capacity. We look forward to the successful closing of the project, and to continuing our cooperation with our longstanding partner ACWA Power in advancing the transition to sustainable energy in the countries we operate in”: confirmed Nandita Parshad, Managing Director- Sustainable Finance Group, EBRD
With one of the lowest generation tariffs in Africa, the Kom Ombo plant will help Egypt reach its goal of getting 42% of its electricity from renewable sources by 2035.
