Egypt to Sell Surplus Power to Africa, Europe

Egypt has started talks on plans to sell electricity to Europe and Africa, pushing its advantage as a cheap renewable energy producer in an attempt to become a regional export centre, its sovereign wealth fund head said.

According to chief executive Ayman Soliman, the country, which has an electricity surplus, sees unspecified "power-hungry" countries to the north as potential customers. Egypt could deliver Europe to Cyprus and Greece through a planned subsea cable.

"To determine feasibility and appetite, we are in talks with European infrastructure developers, advisors and energy traders," Soliman said in an interview in Cairo.

The transmission line "will place Egypt as the centre for Europe's long-term renewable supply."

Electricity exports could be a lucrative earner for Egypt, which after discoveries on the offshore already becomes a natural-gas centre.

The North African country, which has a capacity of approximately 50 gigawatts — a fifth of that amount — has long-used gas-fired plants and hydropower, and is boosting other sources.

Currently, 8.6% of the country's electricity comes from renewables, and by 2022 it targets 20%.

In recent years, three power plants co-built by Siemens AG, a $4 billion solar park in the South, Benban — one of the largest in the world — and a wind farm have bolstered Egypt's potential.

In 2017 the country signed a $30 billion agreement with Russia to develop the first nuclear power plant in North Africa, with a capacity of 4.8 gigawatts.

The surplus represents a reversal from 2013, when Egypt's fast-growing population, the largest in the Arab world, struggled to meet the demand for electricity.

Chronic outages helped to arouse resentment against the government of Islamist President Mohamed Mursi, resulting in his ouster during a popular uprising backed by military forces.

The fund has an arrangement with the Ministry of Electricity to recruit investors for its export plans. Egypt, already linked to Libya and Jordan, also aims to supply emerging economies on its Mediterranean side, according to Soliman.

"We recognise the key players in Africa to partner or collaborate with and we are in discussions with some sovereign funds," said the CEO.

He refused to identify countries or organisations, stating that they would only cover the continent.

Last year Egypt signed an initial agreement with Cyprus and Greece on the EuroAfrica Interconnector.

The fund is in touch with energy traders "to find counterparts that can invest alongside the fund and build the transmission line," and is also having initial discussions with some investors in local and foreign infrastructure, Soliman said.

According to EuroAfrica 's website, the first stage of the Egypt-Cyprus-Greece line is expected to cost € 2.5 billion ($3 billion) and scheduled for commissioning by December 2023, with an initial transmission capacity of 1,000 megawatts.

According to Soliman, Egypt will benefit from the low cost of generating power, particularly for solar.

Benban 's attractive selling price for electricity is 2.4 cents per kilowatt-hour, compared with the average price charged per European household of 23 U.S. cents per kWh.

He cited a profitable selling price for Egypt in the industrial sector of around 9 cents per kWh versus as much as 15.4 cents in nations such as Germany and Italy.

"We're keen to exploit power-hungry, environmentally aware industrial economies," Soliman said.