The European Bank for Reconstruction and Development (EBRD) has decided to provide a loan of $15 million (~₹1.07 billion) to the Arab African International Bank (AAIB) for fostering energy efficiency in the private sector businesses of Egypt.
According to the document released by the bank, Agence Française de Développement (AFD) has co-financed $15 million for the development of a green and clean economy in Egypt.
The money is expected to cover investments in green technologies, such as thermal insulation, photovoltaic solar panels, geothermal heat pumps, and water-efficient irrigation systems.
In addition to the loans, the European Union is also providing help to companies to identify and set up new and efficient technologies and verify its use once they are installed.
Taking it a step further, the bank has reiterated its support for the exchange of green technologies under EBRD’s Trade Facilitation Program. The bank, through its program, provides a guarantee to international banks, taking into account the political and commercial risks of international trade transactions undertaken by banks in the economies where they invest.
Notably, Egypt is a founding member of the EBRD, and the bank has been at the forefront of providing support to various projects in the country. Since it started its operation in the country in 2012, the bank has invested nearly €5.3 billion (~$5.8 billion) in 99 projects across Egypt.
This latest round of funding comes under the Egypt Sustainable Energy Financing Facility (Egypt SEFF), which aims at providing the necessary support and impetus to the development of green energy projects through the support of local banks in the country.
Earlier this year, the government of Egypt had announced that it was in the process of finalizing regulations about the production and sale of electricity from new private renewable power projects directly to consumers by September 2019. Egypt’s ministry of electricity had set up a committee to prepare the standards, regulations, and rules governing the production of electricity from solar and wind stations and selling them to consumers through independent power producers with the payment of electricity network usage fees. Through this, the consumers will have free access to electricity from any licensed company producing and selling energy.
Then in August 2019, EBRD, the International Finance Corporation (IFC), and the Overseas Private Investment Corporation (OPIC), had jointly announced an investment of $252 million (~₹17.96 billion) for a new 250 MW wind project in the Gulf of Suez located in the African continent. The energy generated by the project is expected to reduce carbon dioxide emissions by 550,000 tons per year. This will be the second wind farm in Egypt and will be privately owned.
Rakesh is a staff reporter at Mercom India. Prior to joining Mercom, he worked in many roles as a business correspondent, assistant editor, senior content writer, and sub-editor with bcfocus.com, CIOReview/Silicon India, Verbinden Communication, and Bangalore Bias. Rakesh holds a Bachelor’s degree in English from Indira Gandhi National Open University (IGNOU). More articles from Rakesh Ranjan.