EBRD extends $ 21.3 m loan to Red Sea wind energy farm in Egypt

21 / 11 / 2024

By Marwa Nassar - -

The European Bank for Reconstruction and Development (EBRD) is supporting the development and sustainability of Egypt’s renewable-energy sector by extending a $ 21.3 million loan to Red Sea Wind Energy. The loan will fund the development and construction of a 150 MW expansion to the 500 MW wind farm currently being constructed in the country’s Gulf of Suez region.

The new financing complements an existing loan provided by the EBRD and the Green Climate Fund in 2023, in favor of Red Sea Wind Energy, to finance the original 500 MW wind farm. On completion, this expansion will increase the capacity of the wind farm that is currently under construction, bringing its total capacity to 650 MW and making the wind farm the largest in Egypt and in Africa. The project is expected to help reduce annual CO2 emissions by 1.3 million tons.

Red Sea Wind Energy is a joint-stock company incorporated in Egypt and owned by a consortium of sponsors, including Engie, Orascom Construction, Toyota Tsusho Corporation and Eurus Energy.

The EBRD is the leading development partner in Egypt’s energy pillar of the Nexus on Water, Food and Energy (NWFE), a program unveiled at COP27. This landmark wind farm is one of the first projects to be developed under the country’s energy pillar.

The project will contribute to the 10 GW renewable energy target set under NWFE and will support the government in achieving its renewable energy targets.

The loan agreement was signed in the presence of representatives of the EBRD, Engie, Orascom Construction and Toyota Tsusho Corporation.

Minister of Planning, Economic Development and International Cooperation and EBRD Governor Dr. Rania Mashat emphasized the constructive development partnership with the Bank in the energy pillar of the NWFE program. “This partnership has contributed to increasing private-sector investment in renewable energy through concessional financing exceeding $ 2.5 billion to date, enabling the implementation of projects with a capacity of 4.7 GW. Our goal is to reach 10 GW by the program’s conclusion, supporting the National Strategy for Climate Change 2050, our Nationally Determined Contributions and the country’s target of achieving 42 per cent renewable energy by 2030.”

Nandita Parshad, Managing Director of the EBRD’s Sustainable Infrastructure Group, said: “We are excited to sign the financing of this 150 MW expansion to the remarkable 500 MW wind farm currently under construction in the Gulf of Suez area. This project brings together experienced sponsors from all three continents where the EBRD operates, highlighting our strong partnership and commitment to a sustainable economy in Egypt. Completing the financing of this largest wind farm to date in Egypt and Africa during COP29 also adds to its significance.”