The European Bank for Reconstruction and Development (EBRD) has provided $5.5 million to the renewable energy subsidiary of Egyptian energy company TAQA Arabia to build and operate a 7-MW solar PV project in El Minya, Egypt.
The funding comprises a $4.95 million loan from the EBRD and a $550,000 concessional loan from the Global Environment Facility (GEF). The project will sell all its electrical output to ASCOM Carbonate and Chemical Manufacturing (ACCM) under a 25-year power purchase agreement.
This project falls under the Southern and Eastern Mediterranean Private Renewable Energy Framework (SPREF), which supports the development and financing of innovative business models and the mobilization of private finance for renewable energy projects in the southern and eastern Mediterranean region.
“The new plant will contribute to ACCM’s efforts to maximize the opportunities of using renewable energy resources, reducing its total annual electric power consumption by 16%. It gives us great pride to extend our partnership with the EBRD, a development finance institution that focuses on promoting private-to-private, green, sustainable energy projects aimed at developing society and providing a better quality of life,” said Pakinam Kafafi, CEO of TAQA Arabia.
In December 2020, EBRD provided a $4.2 million loan to finance the construction and operation of a 6 MWp solar PV power plant at Dina Farms in the Beheira governorate, 80 km from the Egyptian capital, Cairo. This plant was the first private-to-private renewable energy project financed by the EBRD in Egypt. The EBRD noted that Egypt aims to increase the share of renewables generation to 42% by 2035 from 20% in 2022.
“Supporting the growing private-to-private segment of renewable energy is critical to accelerate the decarbonization of the economy and foster green supply chains in Egypt and across the African continent,” said Nandita Parshad, Managing Director of the EBRD’s Sustainable Infrastructure Group.
According to Mercom’s 9M and Q3 2022 Solar Funding and M&A Report, large-scale project funding in the first nine months of 2022 came to $22.8 billion in 128 project funding deals, a 97% increase compared to $11.6 billion in 138 projects in 9M 2021.
Last month, Matrix Renewables, a global renewable energy platform, closed $217 million in construction loans, tax equity bridge loans, and back-levered term loans for the Gaskell West 2 and Gaskell West 3 projects.