AfDB Invests USD 550 Million in New Egyptian Power Plant
Tunis, 24 December 2010 – A USD 550-million African Development Bank (AfDB) Loan, approved on 15 December 2010, will help Egypt build a new 650-MW power plant.
“The USD 550-million loan, the biggest ever granted to Egypt in a single operation, underscores the importance which the African Development Bank attaches to power generation,” said Hela Cheikhrouhou, Energy, Environment and Climate Change Director.
Located in Suez city, approximately 150 kms east of Cairo, the 650-MW steam cycle power plant will utilize Egypt’s abundant gas reserves. “Natural gas being the cleanest option in fossil fuels, the government’s policy is to implement an effective natural gas development and domestic utilization strategy to reduce domestic oil consumption with a view to becoming at least self-sufficient in oil supply,” Mrs. Cheikhrouhou added.
The Suez Project will help enhance Egypt’s socio-economic development by increasing power generation in the country. When completed, the project will provide 5.5% of the targeted increase in the installed generation capacity to reach 41 GW by 2017.
Electricity will be evacuated from the plant to the power grid through a 220-kV network by rehabilitating the existing double circuit over-head transmission line and implementing two additional underground cables.
The Egyptian electricity sector has achieved remarkable progress. Access to electricity is almost universal in the country with a coverage rate of over 99%. Electricity is available to the various sectors of the economy including industry, tourism, transport, agriculture, as well as the commercial and social sectors. The availability of affordable and reliable electricity has significantly contributed to the country’s economic growth.
The AfDB has significantly contributed towards making the sector efficient. It continues to play a key role in the development of the sector by ensuring sustainable generation capacity development for the benefit of Egyptians.
Since 1974, the AfDB has co-financed seven power generation plants, one transmission project and two rural electrification projects. It also provided grant funds for several studies. At the end of 2004, the AfDB-supported power generation projects provided some 4,000 MW to the unified power grid (about 31% of the installed capacity at the time) while rural electrification projects connected three towns and close to 200 villages.
The AfDB is also actively supporting the Egyptian government’s efforts to diversify its energy sources. To help the government achieve its objective of providing 20% of the electrical energy from renewable sources, mainly hydro and wind, by 2020, the Bank is considering financing a 200-MW wind energy project and a 100-MW solar power project.
Currently, the AfDB is co-financing three ongoing power generation projects (Kureimat Combined Cycle Power Plant, Abu Qir 1300-MW Steam Power Plant and the Ain Sokhna 1300-MW Steam Power Plant) cumulatively estimated at USD 1 billion, and accounting for about half the AfDB’s overall active portfolio in Egypt.