Multilateral Institutions Provide $479.1 Million Financing for Obelisk Solar Power Project in Egypt

Multilateral development finance institutions are joining forces to support Egypt's energy transition with a significant investment in the Obelisk Solar Power project. British International Investment (BII), the African Development Bank (AfDB), and the European Bank for Reconstruction and Development (EBRD) are providing a total of $479.1 million to finance the development of a 1.1 GW solar power plant integrated with a 200 MWh battery energy storage system in Egypt's Nagaa Hammadi region. The project aims to start operations in two phases, with the first phase expected to begin in the first half of 2026. The facility will generate approximately 3,000 GWh per year of additional renewable power, reducing carbon dioxide emissions by up to 1.4 million metric tonnes annually.

Key Takeaways:

• The multilateral institutions are providing a total of $479.1 million to finance the Obelisk Solar Power project, representing 80% of the total estimated capital expenditure of $590 million.
• The AfDB's financing package includes $125.5 million of ordinary resources, $20 million of concessional funding from the Sustainable Energy Fund for Africa, and $18.6 million from the Canada-African Development Bank Climate Fund.
• The EBRD will provide a financing package of up to $173.5 million, including a $101.9 million guarantee covered by the European Fund for Sustainable Development (EFSD+) first-loss cover guarantee.
• BII financing includes a $100 million concessional loan and a $15 million returnable grant that helps lower the overall cost of the BESS part of the project.
• The integrated power plant will be developed by Scatec, a leading renewable energy solutions provider, in two phases, with the first phase aiming to start operations in the first half of 2026.
• The energy will be sold under a 25-year power purchase agreement with the Egyptian Electricity Transmission Company, backed by a sovereign guarantee.

Statistics:

• $479.1 million: Total multilateral financing for the Obelisk Solar Power project.
• $590 million: Total estimated capital expenditure for the project.
• 80%: Share of the total estimated capital expenditure that the multilateral financing represents.
• 1.1 GW: Capacity of the solar power plant.
• 200 MWh: Capacity of the battery energy storage system.
• 3,000 GWh per year: Additional renewable power generation expected from the project.
• 1.4 million metric tonnes: Potential reduction in carbon dioxide emissions per annum.
• 25 years: Duration of the power purchase agreement.

Sources:

• British International Investment (BII)
• African Development Bank (AfDB)
• European Bank for Reconstruction and Development (EBRD)
• Sustainable Energy Fund for Africa
• Canada-African Development Bank Climate Fund
• European Fund for Sustainable Development (EFSD+)
• Scatec ASA
• Egyptian Electricity Transmission Company