Cairo – October 15, 2023: The European Bank of Reconstruction and Development (EBRD) announced a potential sovereign loan of up to €165 million on Thursday, aiming to upgrade and reinforce Egypt’s electricity transmission grid.
The EBRD has set the approval date for the loan as 13 December 2023.
The loan, once approved, would be lent to the state-owned Egyptian Electricity Transmission Company (EETC) and will help finance several projects including the upgrade of a 500 kV substation in Cairo that will enable the decommissioning of an aging gas-fired power plant in Shubra El Kheima, which is under the Energy Pillar of Egypt's Nexus Water, Food & Energy (NWFE) initiative.
Financing will also be allocated to the construction of a 200 km high-voltage overhead transmission line in the Suez region to distribute some 2.1 GW of renewable energy from local wind power plants.
The EBRD described the potential loan as “Concept Reviewed” in its official project summary document release. At this stage, the EBRD and the “client” – in this case Egypt – would normally sign a mandate letter, which outlines the project plan, development expenses, and responsibilities, according to the bank’s definition.
In the post, the EBRD explained that 60 percent of the loan would be disbursed to the transmission line which qualifies as Green Energy Transition (GET) financing, while 40 percent would be used to finance Cairo’s high- and medium-voltage substations.
Regarding the 40 percent, the EBRD wrote “This amount of GET finance will only be determined during due diligence”.
The Green Energy Transition (GET) is the EBRD’s latest approach to empowering countries to establish green, low-carbon, and resilient economies, with the aim of reaching net annual GHG emissions reductions of at least 25 million tons by 2025.
The GET is also working towards increasing green financing to more than 50 percent of its annual business volume by 2025.
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