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Egypt opportunities - Renewable energy technologies

Tuesday, 25 August 2009 09:20

In Egypt and the whole MENA region there is tremendous potential for the use of renewable energy technologies, especially the generation of wind, solar, biomass, sea waves and hydro energy. Egypt is fast on track to become the leading country in Middle Eastern renewable energy initiatives. The country has adopted an ambitious plan to cover 20% (12000 MW) of all generated electricity by renewable sources in 2020, including a 12% (7200 MW) contribution from wind energy. The new Electricity Act, subject to the approval of Parliament is aimed at diversifying energy sources and enhancing the role of renewable energy in Egypt.

Government Initiatives
In the 1980s the renewable energy strategy was formulated as an integral part of the national energy planning in Egypt when the New and Renewable Energy Authority (NREA) was founded under the auspices of the Egyptian Ministry of Electricity and Energy. The NREA is entrusted to plan and implement renewable energy programs in coordination with national and international institutions. The Egyptian authorities have, together with Denmark, Germany and the EU, been the front-runners in the establishment of a regional centre for Renewable Energy and Energy Efficiency (RCREEE), an independent think tank based in Cairo. It provides a platform for the regional exchange on policy issues and technological questions. It also encourages private sector investment in order to promote growth of a regional industry of Renewable Energy (RE) and Energy Efficiency (EE). While the current global economic downturn emphasizes that there is a continual challenge for the Egyptian government to align pursuing economic growth with protecting the environment, the government has formulated a programme of incentives that includes the continuing reduction of domestic energy subsidies and industrial subsidies which will surely stimulate the renewable energy industry investment. When subsidies are eliminated, renewable energy sources using more capital intensive technologies will be able to compete with oil and natural gas as a power source.

Wind Energy
Wind Energy is scheduled to be the largest contributor to the generation of renewable energy in Egypt. 12% of the 20% of total renewable energy generation is to come from this source. Therefore its implementation and further promotion is central to the NREA activities and future plans.

Egypt enjoys an excellent wind regime, particularly in the Suez Gulf where wind speeds average 7-10 m/s, comparable to the most favourable regions in North-West Europe. The Wind Atlas further indicates high wind energy resources in large regions of the Western and Eastern Deserts, particularly east and west of the Nile Valley.

By 2020 it is expected that wind energy will contribute 7200 MW to renewable energy generation. 550 MW will be added per year of which 200 MW will be generated through the NREA. The Egyptian government is promoting private sector investment in order to reach the proposed addition of 550 MW per year. Wind energy is the most developed renewable energy source in Egypt to date, not least because it is the most cost-effective renewable energy source. A 140MW wind farm has

Already been installed in El Zaafarana1 and El Zaafarana2, and several other wind farm projects are currently being developed in cooperation with Germany. The Suez Gulf is considered to be one of the most attractive areas in Egypt for investors in tourism and resort development. In order to avoid any possible future competition between the wind farm programme and the tourist industry, it is recommended to construct the projected wind farms off-shore.

Solar Energy
Egypt is located in the Sunbelt area which means that the country is endowed with high intensity of direct solar radiation ranging between 2000-2600 kwh/m2/year and sunshine duration that ranges from 9-11 hours with mostly clear days. Egypt’s primary locations are able to offer 500 more hours of solar operation each year compared to Spain and Greece, the most favourable European locations. Especially the Upper Egypt region shows great potential for solar energy development. Solar energy is mainly used for water heating, industrial process heat applications and agricultural drying. There are two principle technologies used in generating solar energy; solar thermal power plants and Photovoltaic (PV) solar energy technology. The first solar thermal power plant has been constructed 90 km south of Cairo at Kuraymat. This location in the desert makes use of the extended unified power grid and expanded natural gas pipelines, as well as being near a source of water, the River Nile.

The power plant is able to contribute 140MW to renewable energy generation. With regard to PV technology, The NREA signed a protocol for cooperation with the Italian Ministry of Environment to electrify two remote settlements in the Matrouh Governorate. The technology behind PV applications is expensive but the higher cost of the set-up is compensated by savings in network construction, maintenance is limited with a life span of around 25 years. The Egyptian government further stimulates investment in solar energy by offering free land to potential investors.

Hydro Power and Nuclear Energy
Hydro-electric power generation has the potential to account for 14% of total generation by 2013. Together with wind energy, hydro power is central to the government’s renewable energy strategy. In theory, the Aswan High Dam Project can generate 2.1GW, currently low water levels prevent this from being realised. A Russian company has been awarded the refurbishment of the power station to increase the capacity to 2.4GW.

The Egyptian government has worked on a comprehensive energy needs assessment and has determined that there is a requirement for four nuclear power stations. In 2007 the World Bank already indicated that it is open to exploring options for financing peaceful nuclear energy projects in Egypt. Following this, the Egyptian government has awarded a contract to an international consultancy agency to recommend the best location for the construction of the first power station. Dabba on the Mediterranean Sea is tentatively receiving the highest consideration. The first power station is set to be completed by 2020.

Conclusion
Egypt is among the first countries to tap into the $5.2bn Clean Technology Fund managed by the World Bank in order to reverse its ever increasing greenhouse gas emissions. Other sources of finance for renewable energy projects include the World Bank Group, African Development Bank and the private sector. Egypt, considered the leader in the region for renewable energy and energy efficiency, has recognized the importance of the development of this sector. Fossil energy consumption is a major source of pollution in the country and a threat to the ecosystem. Furthermore, oil and natural gas are exhaustible resources and the transition to renewable sources will in the future only become more pressing. By developing the renewable energy sector, the government plans to use oil and gas mainly for export. Investment in renewable energy will also open the national and regional market for renewable energy equipment and create many more job opportunities.

Global Arab Network

Created by: The Egyptian-British Chamber of Commerce. 25 August 2009

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