The European Bank for Reconstruction and Development (EBRD) has issued a senior secured loan of up to $100 million to Red Sea Wind Energy for the development, construction and operation of a new 500 MW onshore wind farm located in the Gulf of Suez area in Egypt.
The loan consists of a portion of up to $50 million from the EBRD and a portion of up to $50 million from the Green Climate Fund (GCF) in favour of Red Sea Wind Energy. The loan is co-financed by the Japan Bank for International Cooperation and private commercial banks.
EBRD said that Red Sea Wind Energy is a joint-stock company incorporated in Egypt and owned by a consortium of sponsors, including Engie, Orascom Construction, Toyota Tsusho Corporation, Eurus Energy.
As per EBRD, the wind farm will be the third facility and expected to be the largest in Africa. It will help reduce around one million tonnes of CO2 emissions per year, the equivalent of taking about 217,000 cars off the road.
The energy generated will be sold to the Egyptian Electricity Transmission Company (EETC) over a period of 25 years.
Country Platform for NWFE Programme
This wind farm is one of the first to be built under the Energy Pillar of Egypt’s Country Platform for NWFE programme, which was launched by the Government of Egypt at COP27. EBRD is the lead development partner for the Energy Pillar.
It is the first step in deploying an additional 10 GW of renewable energy capacity between 2023 and 2028. It will also help the country achieve its renewable energy target.
Dr. Mohamed Shaker, Minister of Electricity and Renewable Energy, said: “We want to harness Egypt’s natural resources and make full use of the country’s renewable energy potential. To achieve this, the Egyptian government has created an environment that welcomes private sector investment and builds investor confidence to create a diverse and robust mix of international and local investors in renewable energy projects.”
Nandita Parshad, MD of the Sustainable Infrastructure Group, EBRD, said, “This is a milestone project that will advance a fundamental shift away from Egypt’s reliance on hydrocarbons, create new green business and employment opportunities, reduce pollution and avoid CO2 emissions. The EBRD is and will proudly continue to be one of Egypt’s key partners on its green transition journey.”
Egypt is a founding member of the EBRD. Since the start of its operations there in 2012, the EBRD has invested more than EUR10.2 billion in 162 projects.