Renewable Energy In Egypt Ahmed Sallam Planning Engineer August, 2017

Contents The Legal Framework Renewable Energy Schemes Schemes’ records Certificate of Origin FIT Contents

The legal Framework Law No. 203 for year 2014 The Law defines the 4 main schemes to establish Renewable Energy Power Plants. The law exempted all producers who own power plants with a total installed capacity less 500 Kw from generation license. Law No. 87 for year 2015 (Electricity Law) According to new Electricity Law for year 2015, The Egyptian Electricity Regulator shall find ways through which the utilization of the renewable energy resources and energy efficiency mechanisms shall be promoted.

Contents The Legal Framework Renewable Energy Schemes Schemes’ records Certificate of Origin FIT

Renewable Energy Schemes RE Authority Projects Commercial Scheme Feed_in Tariff BOO Legal Framewrk Law No. 203 Year 2014 Regulatory Framework Issuing the Tariff The regulatory period Max Capacity for each category Approval of Technical Codes Licences Procedures for Dispute Resoultion Currency of Payment Process EETS raise a tender EETC choose the winner EETC sign a PPA with the Producer Regulatory Framework Approval of Technical Codes Issuing Licences Procedures for Dispute Resolution Process NREA raise a tender for EPC of the power plant NREA choose the winner The Winer perform a turnkey project NREA operate the power plant sfter handing over Regulatory Framework Technical Codes Issuing Licences Procedures for Dispute Resolution Regulatory Framework Approval of Technical Codes Issuing Licences Procedures for Dispute Resolution Issuing the wheeling fees Approval of network access and network connection agrrements Activating the Energy Bank

Renewable Energy Scheme (Net-Metering) In 2013 the Regulatory agency issued a decree that allows the customers to build a small PV power plants to be directly Connected to Distribution Network through Net-metering scheme The scheme failed to achieve any records because of the issuance of FIT scheme which by definition provides more incentives to the investors Few months ago, after the devaluation of the local currency which led to a failure of FIT scheme for the small scale projects (< 500 KWp), the Agency updated the net-metering decree that has been issued in 2013 in a way to give more incentive to the customers

Contents The Legal Framework Renewable Energy Schemes Schemes’ records Certificate of Origin FIT

Schemes’ Records

Contents The Legal Framework Renewable Energy Schemes Schemes’ records Certificate of Origin FIT

Certificate of Origin Legal Framework Main Drivers Barriers Law 87 for year 2015 (Electricity law) gives EgyptERA the right to issue a certificate of origin for each 1 MWH produced by Renewable Energy power plants Main Drivers Existence of the legal framework. Potential Customers Tourism Sector Exporting Industrial Sector Barriers Lack of Regulatory Framework Lack of experience in the field of certification No tracking system the enable EgyptERA to track the certificate starting from the issuance till the cancellation of the certificate

Contents The Legal Framework Renewable Energy Schemes Schemes’ records Certificate of Origin FIT

FIT’s Designing Criterion Parameter Value Eligible Technologies Wind & PV Eligible Plants Top Roof PV< 500 KWP Medium Scale PV< 20 MWp 20MWp<Large Scale PV < 50MWp 20MWp<Wind< 50MWp Tariff Calculation Methodology Return on Equity which differs by technology and size Financing Mechanism Burden is distributed equally amongst all electricity Consumer as a part of their electricity tariff Duration of PPA Wind: 20 years PV: 25 years Priority of grid access Yes Grid Connection Cost The interconnection to nearest point on the grid is bared by the investor while deep reinforcement is the utility burden

Risk allocation: Currency Exchange Rate Risk 70 % by the Utility 30 % by the Investor Get Pay Tariff Structure 100% in EP 70% is fluctuating with the fluctuation of the exchange rate 30% considering the exchange rate on the date of FIT issuance

Risk allocation: Currency Exchange Rate Risk (numerical Example) 50 MWp 1 KWH Grid (off-Taker) 8.4 $cent/KWh 30% with 8.88 L.E/$ 0.22 L.E 70% with 18 L.E/$ 1.05 L.E 1.50LE Total 1.27 L.E = 7.1 $cent

FIT’s Rates Technology Capacity Rate PV Wind Size <500 KWp Res: 1.03 L.E/KWh (5.7$cent) Com:1.08 L.E/KWh (6 $cent) 500KWp <Size <20MWp 7.88 $cent / KWh 20MWp <Size <50MWp 8.4 $cent / KWh Wind 3000 FOH: 6.3$Cent/KWh 3500 FOH: 5.69$Cent/KWh 5000 FOH: 4 $Cent/KWh

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