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Ministry of Electricity advises renewable energy companies to sign purchasing agreements - Daily News Egypt

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Ministry of Electricity advises renewable energy companies to sign purchasing agreements

7-day deadline for investors to sign or reject contracts without any amendments to the agreements


By Mohamed Farag

The Ministry of Electricity advised new and renewable energy companies that the signing of agreements will happen during this month, after it finishes reviewing them with the State Council.

Zulficar Law Firm is currently working on translating the energy purchasing agreements under the feed-in tariff, as it will be imposed by State Council within days.

According to the correspondences sent by the ministry to companies, obtained by Daily News Egypt, the companies will have a 7-day deadline to determine their position with the agreements, whether to sign or reject them.

The letter said that the Egyptian Electricity Transmission Company (EETC) will not accept any substantial changes to the main project agreements, and therefore will not enter negotiations with the developers on the amendment of any terms of the agreements.

The main contracts that will be signed by investors pertain to cost-sharing, produced power purchase, linking to the grid, the use of land, and the direct PPA agreement.

The final version of the contract included amendments to a number of items, in response to the comments and observations that investors sent to EETC in April, along with notes by international financial institutions, which will fund more than 90% of the projects.

A source at the Ministry of Electricity said that Zulficar Law Firm is currently translating the agreements, to be sent to the State Council to ensure absence of violation of regulations and legislation, and to approve them for signing with investors.

He added that there will be an initial agreement with investors on the implementation of the projects. The signing of the final power purchase agreement will take place as soon as investors finalise their financial closure statements of their projects, and make sure that they satisfy all the conditions for the signing of the land agreement as well as the temporary licence and studies for the project.

The Ministry of Electricity and Renewable Energy is planning to launch solar projects with a capacity of 2,300 MW, 300 MW of which is small, less than 500 kW projects. The remainder 2,000 MW will be via projects of 20 to 50 MW capacities. Moreover, a wind farm of 2,000 MW will be also established.

In a related context, the Egyptian Energy and Environment Association intends to send a letter to Minister of Electricity Mohamed Shaker on the approval of renewable energy companies, to review the agreements for each company by its own consultant, next to increasing the deadline period identified to respond to the agreements by an additional seven days.

The association includes many companies and alliances of companies working in the field of renewable energy, including Orascom, Oonnera, Philadelphia, Nile Capital, Abdul Latif Jameel, Cairo Solar, Al-Tawakol, Sun Edison.

 

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