Scatec Solar and the Government of Egypt have signed a 25 year power purchase agreement for the supply of electricity from six solar power plants with a combined capacity of 400MW.
The agreement was signed in Egypt’s capital Cairo in the presence of Egypt Electricity and Renewable Energy Minister Dr. Mohamed Shaker El-Markabi and the Ambassador of Norway Sten Arne Rosnes.
The six solar plants, which are estimated to cost $450m, will be located in Ben Ban area near Aswan in Northern Egypt and these plants expected to generate about 870GWh of solar electricity every year.
The projects are part of the 2GW solar FiT programme started by the Egyptian Government back in 2015.
As per the PPA, Scatec Solar will build, own and operate the six solar plants over the 25 year contract period. The solar power producer noted that it will make an equity investment of between $50-70m for the solar projects.
The company is also joining with local developers and with KLP Norfund Investments to gather equity investments for the construction of the solar plants.
A consortium of banks led by the European Bank for Reconstruction and Development (EBRD) is expected to provide a total debt of up to $350m for the project.
The solar plants are estimted to generate annual revenues of about $60m over the 25-year contract.
Scatec Solar in February this year, signed an agreement with A. K. Khan & Company, a Bangladeshi firm, to cooperate on the development of several large scale projects across the country in the near future.
Image: Officials of Scatec Solar and Egypt Government signing the 25 year PPA. Photo: Courtesy of Scatec Solar.