Egypt extends ACWA Power MoU and allocates land for ACURE solar plant

Egypt's National Council for Green Hydrogen approved a one-year extension of the memorandum of understanding with Saudi Arabia's ACWA Power for its planned East Nile project, which will produce 66,000 tonnes of green hydrogen and 500,000 tonnes of green ammonia. Prime Minister Mostafa Madbouly chaired the council meeting, attended by the petroleum, electricity and renewable energy ministers and other officials.

ACWA Power signed a framework agreement in December 2023 after a 2022 memorandum to develop Egypt's first green hydrogen phase, with investment exceeding $4 billion. The first phase aimed to produce 600,000 tonnes of green ammonia a year, with plans for a second phase raising capacity to 2 million tonnes annually.

The council also approved allocating a 12-square-kilometre plot in West Zaafarana to India's ACURE to build a 600 MW solar plant supporting the pilot phase of its green ammonia project, which targets 100,000 tonnes a year. The wider project is planned to reach 1 million tonnes a year through successive phases.

The meeting reviewed the implementation of agreements signed with international companies and discussed an integrated framework to address the challenges facing green hydrogen projects through coordination among the relevant ministries. The decisions are part of Egypt's efforts to become a regional hub for low-carbon hydrogen and its derivatives after approving its National Low-Carbon Hydrogen Strategy in February 2024, which targets renewable energy exceeding 42% of the electricity mix by 2030. Law No. 2 of 2024 grants incentives of up to 55% and tax exemptions on equipment and exports.

What do these terms mean?

Green hydrogen: A fuel produced from water using electricity from renewable sources such as solar and wind, with no carbon emissions when burned.

Green ammonia: A chemical made from green hydrogen and used as fertiliser, fuel and an easier way to store and transport hydrogen.

Memorandum of understanding: A non-binding agreement setting a framework for cooperation between two parties and paving the way for later executive agreements.