Norwegian solar project developer Scatec Solar has secured 25-year Power Purchase Agreements (PPA) with the Egyptian government for a 400MW solar power portfolio.
Included in the PPA are six solar power plants that are all located in Ben Ban region near Aswan in Northern Egypt. Put together, the solar plants which were developed under the 2GW solar FiT programme launched by the Egyptian Government in 2015 generate 870GWh of clean energy every year.
Scatec Solar will construct, own and operate the projects while committing to a total equity investment in the range of $50-70m.
The total investment involved in the six projects has been estimated at $450m while the expected revenues are around $60m each year through the course of the 25-year PPA period.
Scatec Solar CEO Raymond Carlsen said: “With this programme the Government of Egypt is making important steps towards accessing clean and low cost electricity to drive development and economic prosperity. Scatec Solar and partners are making significant investments and long term commitment to Egypt.”
Scatec Solar is collaborating with local developers and with KLP Norfund Investments to attract equity investments in the solar projects. It further has plans to add more partners to an equity consortium before closing the financial part of the portfolio.
A consortium of banks led by the European Bank for Reconstruction and Development (EBRD) is likely to help the six projects by granting a debt of up to $350 million.
Once operational, the energy generated from the 400MW solar portfolio will offset around 350,000 tons of CO2 emissions every year, thereby boosting Egypt's emission reduction targets.
Elsewhere in Bangladesh, in February, Scatec Solar agreed to jointly develop a number of large scale solar projects across the country in partnership with the A. K. Khan & Company.
Image: Scatec Solar and partners sign PPAs for 400MW solar energy in Egypt. Photo: courtesy of Scatec Solar.