DEG invests in renewable energy projects in Egypt

DEG is providing Alcazar Energy Partners with a total of USD 145.5 million to finance the construction of two wind farms. With a combined installed capacity of 500 MW, the wind farms are expected to generate more than 2.3 TWh of renewable electricity per year.

The Niat and Rasgha wind farms, each with a capacity of 250 MW, will be built near Ras Ghareb on Egypt’s Red Sea coast. DEG is financing the projects by providing long-term loans of USD 75 million and USD 70.5 million, respectively.

Total investment costs amount to approximately USD 580 million. Of this, around USD 437 million is being provided in equal shares by DEG, the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB). The financing is partially backed by guarantees under the EU’s European Fund for Sustainable Development Plus (EFSD+). These guarantees are available for projects of particular developmental relevance in higher-risk markets and, in this case, support long-term investment in the expansion of renewable energy generation in Egypt.

“With the loans for the Niat and Ras Ghareb wind farms, DEG is helping to expand renewable energy generation capacity in a power system that must meet growing electricity demand. At the same time, the projects are helping to reduce dependence on costly fossil-fuel-based power generation. We are pleased to support our long-standing customer Alcazar Energy Partners, which is using state-of-the-art European wind turbines for these projects. In doing so, we are promoting the supply of renewable energy, a strategic priority for DEG,” says Monika Beck, member of DEG’s Management Board.

European technology and local employment

German-Spanish wind turbine manufacturer Siemens Gamesa Renewable Energy is supplying the wind turbines and providing operation and maintenance services. During the construction phase, more than 1,000 workers are expected to be employed in implementing the two wind farm projects.

Contributing to Egypt’s renewable energy targets

Once fully operational as planned by the end of 2028, the Niat and Rasgha wind farms are expected to supply around 300,000 households with green electricity each year and avoid nearly 1.1 million tonnes of CO2 emissions annually. The projects will thus contribute to Egypt’s target of increasing the share of renewable energy in electricity generation to 45% by 2028.

Further DEG investments in renewable energy

In addition, DEG has recently committed loans totalling USD 185 million for two further renewable energy projects in Egypt. Together with partners including the EBRD, it is financing a 1,000MW solar project in Minya, incorporating a 600MWh battery energy storage system, as well as the expansion of the Benban solar park near Aswan by 200MW, together with a 120MWh battery energy storage system. Developed by Infinity Power Holdings and Hassan Allam Utilities Energy, the projects will contribute to the further expansion of renewable energy generation and enhance grid stability through energy storage technologies. Together, they are expected to avoid around 1.7 million tonnes of CO₂ emissions annually.

Further information

Financing and Advisory for Infrastructure and Energy Projects