Gurleen Kaur, Associate Director, Synergy Consulting, Inc. shares insights:

Energy grew Egypt’s GDP by 13.1% through the deployment of an energy diversification strategy. Adding 28.5 GW to the grid enabled the transition for Egypt from a power deficit nation to power surplus nation. On target to produce 61 GW of renewable energy, as part of Egypt’s 2035 strategy, it will also meet commitments to diversify technologies. The share of renewable energy-based resources increased at a CAGR of 35% while reducing reliance on fossil fuels.

The above success is heavily reliant on Egypt’s private sector integration. Currently a single-buyer model, the electricity sector is dominated by state-owned entities with a promise to privatize where state involvement delays private investment. Recently this initiative was revitalized with a plan to double the private sector’s share of the economy where the private distributors are allowed to develop, implement, operate and maintain distribution within a licensed network. Currently ten state companies are to be privatized from 2022. Approximately 63 companies are licensed to distribute electricity in Egypt, EEHC however accounts for 99% of the network.

Going forward, the private sector is envisaged to participate in all stages of post electricity generation including distribution, installation, operating and electronic payment systems, and will include projects such as electric vehicles, charging stations, data centers, networks oil and gas, expansion of gas liquefaction plants, communication towers, and wind power.

There is a trend for the energy sector to be a fully competitive by 2025.. The initiatives in the Egypt’s power sector are being supported through the ministry, and lending institutions such as European Investment Bank (EIB), European Bank for Reconstruction and Development (EBRD), World Bank, Arab Fund for Economic and Social Development (AFESD), and Agence Française de Développement (AFD) among others.

A privatization plan for Egypt is significant in being a principal influencer across the regional energy value chain.