US$ 335 million financing package for Scatec Solar's 300 MWAC projects
The EBRD has teamed up with development partners to make a significant investment in the renewable energy sector in Egypt with the financing of Africa’s largest solar plant.
Funding of US$ 335 million from the EBRD, the Green Climate Fund (GCF), the Islamic Development Bank (IsDB), the Islamic Corporation for the Development of the Private Sector (ICD) and the Dutch development bank FMO, will support the Norwegian developer Scatec Solar and its partners in constructing a portfolio of six 50 MWAC solar plants at the Benban complex in Upper Egypt, which upon completion will be the largest solar installation in Africa, with a planned total capacity of 1.8 GW.
The EBRD is providing loans of US$ 235 million, of which US$ 48 million is provided by the GCF and US$ 72 million will be provided by FMO. In addition, IsDB will extend US$ 75 million and ICD US$ 25 million.
These projects are part of the EBRD's new US$ 500 million framework for renewable energy in Egypt, which is expected to finance a total of 16 projects delivering 750 MW of capacity.
The Green Climate Fund contribution is the first such support provided under the agreement on cooperation signed between the EBRD and the GCF in April 2017, underscoring the EBRD’s position as the largest single recipient of GCF resources and paving the way for more joint projects aimed at combating climate change in the Bank’s regions. In October 2016 the GCF decided to allocate US$ 378 million to support green investments by the EBRD.
Support for the framework has been provided by the SEMED Energy Efficiency Policy Dialogue Framework, funded by the European Neighbourhood Investment Facility, and the SEMED Multi-Donor Account.
Harry Boyd-Carpenter, EBRD’s Head of Power and Energy Utilities, said: “We are delighted to support today the largest solar portfolio in Egypt's feed-in-tariff scheme, and to work again with Scatec Solar. As well as its size this project is notable as our first investment with the Green Climate Fund under our Egypt Renewable Energy Financing Framework. Climate finance has a critical role to play in catalysing new renewable markets such as Egypt's and we are very grateful for the GCF's support on this project. It is an excellent example of how partners from the private and the public sector can work together to address one of the core issues of our times: the development of sustainable and environmentally friendly generation and supply of energy.”
“This first investment with the EBRD under our Egypt Renewable Energy Financing Framework project is a big step forwards. It shows the potential for public and private climate finance to drive the low emission energy transition in support of Egypt’s climate goals,” said Ayaan Adam, Private Sector Facility Director at Green Climate Fund.
“With this programme the government of Egypt is making important steps towards accessing clean and low-cost electricity to drive development and economic prosperity. Scatec Solar and partners are making significant investments and making a long-term commitment to Egypt,’’ said Raymond Carlsen, CEO of Scatec Solar.
The EBRD is a leading multilateral development bank in the field of green investments and the GCF signed an agreement on cooperation in April 2017 that underscores the EBRD’s position as the largest single recipient of GCF resources and paves the way for more joint projects aimed at combating climate change in the Bank’s regions.
Under its Green Energy Transition (GET) approach launched in 2015 the EBRD seeks to increase the volume of green financing from an average of 24 per cent of its annual business investment in the 10 years up to 2016 to 40 per cent by 2020.
To date, the EBRD has invested more than €3.8 billion directly in renewable energy, supporting 119 projects in 23 countries and funding more than 6 GW of capacity.
Egypt is a founding member of the EBRD and has been receiving funding since 2012. To date, the Bank has invested €2.7 billion in 51 projects in the country. The EBRD’s areas of investment include the financial sector, agribusiness, manufacturing and services, as well as infrastructure projects such as power, municipal water and wastewater services and support for transport services. The Bank has also provided technical assistance to more than 500 small and medium-sized local enterprises.