The Ministry of Electricity signed a cost-sharing agreement with 24 renewable energy companies that have qualified for the implementation of solar and wind power plants through the feed-in tariff system.
A senior official with the ministry said the companies that signed the agreement will pay 30% of the cost-sharing value within 10 days. It will include the value for the construction of roads and electric substations to transfer energy produced from the Benban station in Aswan.
The source told Daily News Egypt that investors will pay EGP 3,100 per MWh for constructing roads. They will also pay EGP 583,000 per MWh produced from solar plants to be linked to substations.
The companies that signed the agreement include Cairo Solar, Cazar Energy, the Egyptian Company for Solar Energy Development, First Solar, Nile Solar, Infinity 50, Jordanian Egyptian Solar, and O Capital, among others.
The signing of the agreements was attended by Minister of Electricity Mohamed Shaker, Deputy Minister of Electricity Osama Asran, Head of the Renewable Energy Authority Mohamed Salah Sobky, Chairman of the Egyptian Electricity Transmission Company Gamal Abdel Rahim, and Director of Solar FIT Programme at the Ministry of Electricity Lamyaa Abdel Hady.
The agreement was signed by three parties; the renewable energy companies as investors, the Egyptian Electricity Transmission Company, and the Renewable Energy Authority represented by Abdel Rahim and Sobky.
The source said the ministry will sign the agreement with 15 more companies, with the final number of included companies totalling 39. These are the companies that have obtained lands in Benban, Aswan to establish solar plants of 1950 MW capacity.
The ministry provided investors with a 10-day grace period, starting Tuesday, to pay 30% of the value of cost-sharing, with a letter of guarantee for the remaining sums. The total amount expected to be paid by investors is estimated at EGP 350m, which will be paid to the Egyptian Electricity Transmission Company and the Renewable Energy Authority.
Each company is committed to pay EGP 9m out of EGP 27m for linking the production to the national grid and 12.5% additional costs.
Chairman of Cairo Solar Hesham Tawfik said they signed the agreement on Monday, and will pay 30% of the cost-sharing value within days. The government has been taking positive steps towards the completion of renewable energy projects according to the feed-in tariff. He said the government has been removing obstacles before investors to complete the projects in time.
Head of projects department at Desert Technology Mohamed El-Deley signed the agreement on behalf of Nubian and ERC, which are subsidiaries of Desert Technology. “We will pay 30% of the agreement next week,” he said.
The company is preparing a letter of guarantee for the remainder of the agreement. “We will not back down from implementing our projects, especially in light of the positive steps the government has taken,” he said.