Renewable Energy Strategy in Egypt

Mohamed Mostafa El-Khayat

New and Renewable Energy Authority, NREA Egypt

mohamed.elkhayat@yahoo.com www.energyandeconomy.com

Maghreb Renewable Energy Congress

Rabat, 21-22 May 2013

CONTENTS
- Introduction - Wind Energy Projects

- Solar Energy Projects

- Available Technical Know-How - Assessment for Renewable energy plan

Introduction

Resource Assessment

Average Annual Direct Solar Radiation in Egypt

Egypt Wind Atlas

Renewable Energy Strategy In February 2008, the Supreme Council of Energy had approved Egypts Renewable Energy Strategy, which aims to satisfy 20% of the generated electricity from renewable energies by 2020, including:Wind; 12.0%

Hydro; 5.2%

Solar and others; 2.8%

Total installed capacities are around 14 GW of different technologies

Share of Renewable Energy Sources by 2020

Solar Energy Plans Solar Energy Targets until 2027

Install 3500 MW by year 2027 2800 MW CSP 700 MW PV Estimated Energy

5 TWH/Year (Starting from Year 2020)

14 TWH/Year (Starting from Year 2027) Fuel Savings : 3.0 million TOE CO2 abatement : 7.7 million

Introduction

EETC
(BOO)

(FiT)

NREA (33%)
Egypt Renewable Energy Strategy up to 2020, Possible Tracks
EETC: Egyptian Electricity Transmission Company BOO: Build Own Operate FiT: Feed-in-Tariff NREA: New and Renewable Energy Authority

Renewable Energy Incentives

- More than 7600 square kilometers of desert lands have been allocated for implementing future projects.

- All permits for land allocation are already obtained by NREA.

- Signing land use agreement against 2% of annual produced energy. - Exempting all renewable energy equipment and spare parts from the customs duties. - Renewable energy fund has been established. - Signing long term PPA ( 20-25) years. - Central Bank of Egypt will guarantee all financial obligations of EETC under the PPA. - The project will benefit from carbon credit . - The project company shall get license for power generation from Egyptian Electricity Regulatory Agency.

Wind Energy Projects

Demonstration Projects
The first wind farm (5 MW) was established at Hurghada in 1993, it includes 42 WTs of different types and sizes.
Some components were locally manufactured (towers, blades, other mechanical and electrical components).

German WT Pitch regulated

Tubular tower 100 KW

Danish WT Stall regulated Tubular tower 100 KW

Danish WT Stall regulated Lattice tower 300 KW

Large Scale Wind Farms Since 2001, a series of large scale wind farms were

established with total capacity of 550 MW in cooperation

with Germany (KFW), Denmark (DANIDA), Spain and

Japan (JICA).
- Another 1000 MW of wind projects are under construction and development. - In Dec. 2012 NREA launched an auction to install 600 MW (6 x 100MW) by private sector to feed their own loads and/or sell electricity to their own consumers.

Wind Farms

Distribution of Wind Turbines, Zafarana Wind farm, Egypt

Current Renewable Energy Projects Solar Energy - Photovoltaic (PV) Applications

Commercial applications : Telecommunications Remote roads lighting and billboards lighting Remote desert small loads

A project to electrify 2 remote settlements with PV systems in Matrouh Governorate had been implemented, in cooperation with the Italian Ministry for Environment, Land & Sea. The project operated since end of 2010.

Current Renewable Energy Projects Solar Energy - Solar Thermal Energy Applications
A project for disseminating solar water heaters in hotels and resorts on two governorates is currently under preparation, in cooperation with the UNEP and Italian Ministry for Environment, Land & Sea. Total no. of hotels: 17 Total erected area : 1700 m2 Targeted Area : 5000 m2 Domestic solar water heating systems are used in touristic places. There are some local companies are working in manufacturing and importing solar water heating systems for competing in the Egyptian market.

Current Renewable Energy Projects Solar Energy - Solar Thermal Electricity Generation
140 MW Solar thermal power plant including solar field of 20 MW. The total investment is about $US 340 mio. GEF has approved $ 49.8 mio. grant for the solar Island. Japanese Bank for International Co-operation offered the finance of the combined cycle island & consultancy services with about (19.5 Billion Yen) Project is in operation since June 2011.

Solar Energy Plans On going Photovoltaic Projects

20 MW at Hurghada in co-operation with JICA/Japan. 20 MW at Kom Ombo in co-operation with Afd/France. Electrifying fence of Kuraymat Integrated Solar Thermal power Station ( 8 km) in co-operation with China. Electrifying three villages at Matrouh Governorate in co-operation with India. Electrifying two villages at El-Wadi El-Gedeed Governorate in cooperation with Finland.

Solar Energy Plans On going CSP Projects

100 MW in co-operation with world Bank & African Development Bank.

World Bank allocated a loan of US$ 100 million through Clean Technology Fund (CTF) to finance this project .
The world Bank & African Development Bank agreed, in principle, to support the Government of Egypt in financing this project by allocating loans of US$ 170 million each.

Available Technical Know-how

Available Technical Know-how

BLADES
Blades represent around 25% of the wind turbine components, moreover it needs a high technology manufacturing level. During the demonstration phase of wind farm, fiber glass blades for 100 kW and 300 kW were manufactured locally in collaboration with Danish MAT Co. The cost of the locally manufactured unit at that time was estimated at 73% of the imported turbine cost. Fiber glass blade manufacturing can be achieved in the workshops of the Arab Organization of Industrialization (AOI), Suez shipbuilders and fiber glass boat manufacturers Currently a blade factory is under construction by an Egyptian company.

Available Technical Know-how

TOWER Egyptian manufacturing of wind turbine towers enjoys a cost advantage, due to availability of the know-how locally, and high costs of overseas sea transport and insurance. Wind turbine suppliers prefer manufacture towers in the domestic factories. Many companies in Egypt have the potential in local manufacturing of towers. Samples of Egyptian manufacturers are; Orascom Group, Ferrometalco, and the Egyptian Iron and Steel Co.

Available Technical Know-how

ELECTRICAL COMPONENTS Some of the electrical components such as cables and transformers are currently manufactured by companies such as Schneider, ABB, Al-Sweedi Cables and Almaco.

MECHANICAL PARTS Mechanical components such as shafts can be manufactured in the workshops of Military factories, AOI and Ferrometalco as examples.

An Assessment for Renewable Energy Plan

An Assessment for Renewable Energy Plan Strength

Weakness

Opportunities

Threats

- High potential resources either solar or wind; Potential direct solar radiation ranging between 2000 3200 kWh/m2/year from North to South. - Clear National Targets; 20 % by 2020 and for solar Install 3500 MW by 2027. - Total area required for the targeted projects is desert land. - Part of potential sites are located at Red Sea coast, North Sea coast, .. etc; close to touristic areas, which could include potential customers. - Human resources are available. - Governmental Incentives.

An Assessment for Renewable Energy Plan

Strength

Weakness

Opportunities

Threats

- Grid: Most of potential sites are far from loads; which seeks extending transmission lines to evacuate the generated electricity into the national grid.
- Incentives: - More dynamic mechanisms still absent; i.e. Feed-in-tariffs and renewable portfolio standards. - No privilege incentives have been assigned for renewable energy consumers. - Subsidy allocated for fossil fuel. - High cost of CSP technology compared with other renewable energy technologies. - Absence of national obligations for using solar water heaters in designated sectors (i.e. residential, touristic, etc). -Weakness of local financing schemes.

An Assessment for Renewable Energy Plan

Strength

Weakness

Opportunities

Threats

- Continue decreasing of wind and PV prices, this has been reflected in the new additional capacities each year. - Use PV systems to power streets, advertising, and remote areas. - For Short term; Focus on low technology of solar energy applications in promoting local manufacturing market. - For long term; Focus on R&D applications and link it with the market needs. - Allocate local loans with soft conditions (low interest rate and long repayment period). - Existing of international initiatives such as (MSP and DII).

An Assessment for Renewable Energy Plan

Strength

Weakness

Opportunities

Threats

- Decreasing of development growth rate due to shortage of energy availability.

- Low share of local financing schemes will lead to full dependency on

International loans, which need lengthy procedures. - Unavailability of establishing local market for solar applications. - Dispersion of R&D efforts