EBRD backs 1 GW solar-plus-storage project in Egypt with $30 million loan

The European Bank for Reconstruction and Development (EBRD) has provided a US$30 million equity bridge loan to support Egypt’s first major hybrid renewable energy project, which has now officially broken ground. The project combines large-scale solar with battery storage capabilities.

Norwegian renewables developer Scatec has commenced construction on the 1.1 GW solar plant with a 100 MW/200 MWh battery energy storage system in Nagaa Hammadi through its special purpose vehicle, Obelisk Solar Power. The first phase will deliver 561 MW of solar alongside the full battery storage component, with commercial operation targeted for the first half of 2026.

The battery storage component addresses critical challenges in Egypt’s electricity system, which has struggled with frequent blackouts during peak summer months when demand can surge up to 30 GW. Egypt’s power demand has grown at roughly 6% annually over the past decade, outpacing generation capacity expansion. The 200 MWh storage system will provide crucial grid services in Upper Egypt, a region that has historically suffered from weaker transmission infrastructure.

Scatec will handle engineering, procurement, construction, asset management, operations, and maintenance services for the entire facility.

Total capital expenditure for the project is estimated at $590 million, with 80% expected to come from non-recourse long-term project debt. In addition to the EBRD’s $30 million contribution, Scatec has secured a $90 million equity bridge loan from the Arab Energy Fund, allowing the company to postpone project equity injections until construction completion.

The development falls under Egypt’s Nexus on Water, Food and Energy programme launched at COP27. Once fully operational, the project is expected to reduce CO2 emissions by approximately 1.3 million tonnes annually.

The second phase, comprising 564 MW of additional solar capacity, is scheduled for completion during the second half of 2026.