Saudi developer ACWA Power has finalized agreements for the 200MW Kom Ombo solar plant in Egypt, with construction work set to begin later this year.
A 25-year power purchase agreement and network connection contract were signed at a virtual ceremony by senior ACWA representatives and Egyptian government officials.
The Saudi company is due to obtain $40-million senior debt financing and a $14 million equity bridge loan from the European Bank for Reconstruction and Development (EBRD), and a $27.2-million loan from the African Development Bank (AfDB) to finance the project.
Finalizing the project agreements for Kom Ombo marks a “significant milestone” towards fulfilment of the plant, said Rajit Nanda, acting chief investment officer of ACWA Power.
"The tariff is the lowest in the African continent for a project that is soon to achieve financial close and commence construction, which demonstrates that globally-competitive tariffs are possible in North Africa and the wider African region, we remain on track to achieve commercial operation in Q3 2022, utilizing ACWA Power’s operational excellence and technological know-how in delivering electricity and desalinated water across the markets we serve."
For his part, Egypt's Minister of Electricity and Renewable Energy, Mohamed Shaker El-Markabi said: "In line with Egypt’s Integrated Sustainable Energy Strategy, our aim is to produce 42% of Egypt’s electricity using renewable sources by 2035."
He added: "Currently necessary studies are being conducted to increase this percentage, stressing on maximizing the utilization of renewable energy in many areas, including water desalination and green hydrogen production."
Kom Ombo PV is part of ACWA Power’s established energy portfolio and proven track record in Egypt, which currently includes three solar PV projects located in the Aswan province (Benban 1, Benban 2 and Benban 3) with an aggregate capacity of 120 MW, as well as the 2250MW Dairut-Luxor CCGT IPP in the Luxor Governorate.
Construction of the plant is expected to begin in the third quarter of 2021 and upon completion, Kom Ombo PV will cater to the power needs of 130,000 households and offset 336,000 tons of carbon dioxide per year.