Egypt Changes Solar Power Scheme To Attract International Investors
Egypt plans to change regulations for the next push of solar power expansion following concerns raised by some international project developers.
The Egyptian government has announced plans to change rules and regulations pertaining to the second phase of solar power expansion. The government will now allow international arbitration to address disputes. Earlier, several foreign project developers held back investment as offshore arbitration was not allowed.
Such concerns were likely raised by some of the 39 project developers that has signed agreements to set up projects in 1.8 GW solar power park at Aswan.
Some of the companies that signed these project development agreements include Enel Green, EDF, Access Building Energy, and Building Energy Alliance. Companies that had signed the agreement earlier included TAQA Arabia, Cairo Solar, Orascom, Lekela Power (a joint venture between Mainstream Renewable Power and Actis).
However, while conceding the legal relief to project developers, the government also moved to cut feed-in tariffs for solar power projects covered under the impending second round of project allocation.
The Ministry of Electricity and Energy recently announced that it reduced the feed-in tariffs for solar power projects. Projects with size of 500 kW to 20 MW will now have feed-in tariffs of US¢7.8/kWh, down from US¢13.6/kWh while projects of size 20-50 MW will see feed-in tariffs fall from US¢14.0/kWh to US¢8.4/kWh. These tariffs will be applicable to the second phase solar power projects implementation.
Egypt plans to set up 2 GW wind energy and 2.3 GW solar power capacity by 2022. It also plans to increase the share of renewable energy in the electricity market to 20% by the same year.