Marco Arcelli, the chief executive officer of ACWA Power, stated that their success in receiving financial help for the renewable project is a remarkable win
ACWA Power, an operator of power generation and desalinated water production plants, disclosed to the public that they have secured a financial package of $123 million for the development of the 200-megawatt Kom Ombo project, a solar project in Egypt.
The Kom Ombo project is less than 20 km away from AWCA, another power development project, the 1,465-megawatt Benban complex. This 1,465 megawatt is Africa’s largest solar park and is expected to start operating commercially in January 2024. It will power 130,000 households at its fully functioning capacity.
Marco Arcelli, the chief executive officer of ACWA Power, stated that their success in receiving financial help for the renewable project is a remarkable win. They are on their toes to fasten the developmental project whilst keeping in mind Egypt’s energy goals.
The financial support poured in the forms of debt of $34.5 million from the European Bank for Reconstruction and Development (EBRD), $14.6 million from the OPEC Fund for International Development or the OPEC Fund, $14.4 million from the African Development Bank (AfDB), $34.5 million from the Green Climate Fund (GCF), $14.8 million from the Arab Bank, and $10 million from the AfDB’s Sustainable Energy Fund for Africa (SEFA).
This project has equity loans from the Arab Petroleum Investments Corporation (APICORP) and EBRD amounting to $45 and $14 million, respectively.
Arcelli added an appreciation note that the Kom Ombo solar project displays the heightened interest of the private sector in harnessing Egypt’s solar capabilities. It also showcases the similar vision and purpose of international financing institutions in accomplishing the nation’s goals. He also thanked the government, the citizens, and the local communities, without whose support this project would not have seen the light of day.
Arcelli highlighted the point that this new financial support deal is the benefit of confidence that major financial institutions bestow upon them. It is also due to their success in building large-scale projects. With this $123 million funding, they are highly devoted to working in tandem with all their partners across the public and private sectors to ensure that this project turns out to be successful.
The Ministry of Electricity and Renewable Energy and the Egyptian Electricity Transmission Company (EETC) conducted policy dialogues that led to the successful involvement of the private sector in the Kom Ombo project.
The $3.6 million technical assistance program funded by the EBRD and the GCF for supporting the EETC to manage competitive renewable energy tenders was also a major catalyst for the entry of the private sector. The reforms in the energy sector brought in by the AfDB in the past few years have also helped the sector in larger terms to attract interest from the private sector.
They are very happy with the financial support and the strengthened ties with ACWA Power in their promotion of renewable energy in Egypt and all across Africa. The widespread clean energy generation is key to the low carbon footprint of the African continent. This further leads to lower carbon emissions and meeting the goals laid out in the Paris Agreement.
This is well aligned with the strategy of AfDB to boost clean energy growth in Africa. Kom Ombo solar project is their debut partnership with EBRD and OPEC Fund in Egypt, and they are looking forward to working in more partnerships as they are open to promoting co-financing ventures over the African continent, said Kevin Kairuki, the African Development Bank’s Vice President in charge of Power, Energy, Climate Change and Green Growth.
Nandita Parshad, the Managing Director of Sustainable Finance Group, EBRD, said that they take pride in financially supporting the strategic project. The Kom Ombo project is the result of the first tendered project in Egypt. It is also the first to be delivered under the ENergy Pillar of the Nexus Water Food Energy (NWFE) initiative. Under this initiative, the Egyptian authorities are focused on building 10 gigawatts of new renewable projects and discarding the 5-gigawatt thermal capacity.
The Kom Ombo Plant will help the Egyptian government to meet its target of generating 42 percent of required electricity through renewable sources by 2035. It will also be one of the lowest tariff generators in Africa.