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Egypt Seeks Innovative Financing for Renewable Energy Projects Under NWFE Programme

Rania Al-Mashat, Minister of International Cooperation, chaired the first high-level coordination meeting at the Ministry’s headquarters in the New Administrative Capital to discuss the mobilization of innovative financing tools for the energy sector under the NWFE Programme. The Programme aims to implement renewable energy projects with a total capacity of 10 gigawatts, replacing 10 thermal power plants with a capacity of 5 gigawatts.

The meeting was held in preparation for the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP28) in the United Arab Emirates, where Egypt will showcase its progress in fulfilling its pledges made at the COP27 climate conference in Sharm El-Sheikh.

According to a statement from the Ministry on Monday, the energy sector under the Programme will leverage various financing solutions, such as grants, debt swaps, technical assistance, credit guarantees, risk mitigation, private sector investments, and concessional development financing. These solutions will help Egypt achieve its goal of increasing the share of renewable energy to 42% by 2030 instead of 2035, as part of its updated Nationally Determined Contributions (NDC) plan. Egypt is also implementing the national strategy for sustainable and integrated energy, which requires about $10bn of investments in the energy sector over five years.

The energy sector aligns with the National Climate Change Strategy to achieve sustainable economic growth and reduce carbon emissions. It also supports the sustainable development goals related to clean energy, climate action, and local community development. The project is expected to save about $1.2bn a year that used to be spent on fuel for operating thermal power plants.

“Before COP27, we worked together to prepare the national platform for green projects, the NWFE Programme, as an integrated platform for climate and development actions. Our partners, including Odile Renaud-Basso, President of the European Bank for Reconstruction and Development, contributed to highlighting the platform globally, making it one of the key national platforms recognized by development partners and a model that can be replicated,” said Al-Mashat.

She added: “During COP27, a joint political declaration was issued between Egypt, the United States, and Germany to support the energy sector under this Programme. It included key points, such as updating Egypt’s NDCs and advancing the target date for increasing the percentage of renewable energy to 42% by 2030 instead of 2035.”

Al-Mashat noted that Egypt has already fulfilled this commitment amid global challenges and economic fluctuations, and announced the update of its NDCs last June.

She also noted that the political declaration included German pledges to implement new tranches of debt swaps for development directed to the energy sector of the Programme. A tranche worth €54m had already been signed as a result of updating NDCs, out of €104m pledged by Germany to fund two wind farms with a capacity of 500 megawatts. This will help Egypt achieve its goal of producing electricity from renewable energy sources by 42% by 2030.

The Minister of International Cooperation emphasised that the NWFE Programme not only promotes Egypt’s green economy transition through renewable energy but also through green hydrogen. The platform broadens the scope of work to achieve Egypt’s objectives of becoming a regional hub for renewable energy. Al-Mashat concluded by saying that these actions demonstrate Egypt’s strong commitment to the green transition.

Source: Daily News Egypt