What's Happening?
The African Development Bank (AfDB) has approved a $66 million funding package for EgyptAlum's 500MW Dandara solar project and a 100MWh battery energy storage system in Qena Governorate, Egypt. This financial support includes $46 million from AfDB's ordinary
resources and $20 million from the Climate Investment Funds' Clean Technology Fund. The project, with a total estimated cost of over $290 million, aims to develop a photovoltaic power plant integrated with battery storage. EgyptAlum will be the sole off-taker under a 25-year Power Purchase Agreement, supported by a wheeling agreement with the Egyptian Electricity Transmission Company. The project is expected to be fully operational by early 2028, generating approximately 1,373 gigawatt-hours of electricity annually and reducing CO2 emissions by around 500,000 tonnes per year.
Why It's Important?
This project is significant as it represents a major step towards industrial decarbonization in Egypt, aligning with global efforts to reduce carbon emissions. It will help EgyptAlum maintain its European aluminum market share amidst the European Union's Carbon Border Adjustment Mechanism, which took effect in January 2026. The initiative is expected to safeguard over 6,000 jobs in Egypt and create approximately 2,500 construction jobs, with a focus on women and youth employment. Additionally, the project sets a benchmark for private investment in renewable energy and industrial decarbonization in Egypt and the wider region, potentially attracting further investments in similar projects.
What's Next?
The project is anticipated to be operational by early 2028, with ongoing construction and development phases. As the largest private corporate Power Purchase Agreement in Egypt and the region, it may pave the way for future private investments in renewable energy. The successful implementation of this project could encourage other industries to adopt similar decarbonization strategies, contributing to Egypt's broader renewable energy goals and economic development.
