June 28, 2026

Egypt Targets 60% Renewable Electricity by 2040

Egypt has steadily been increasing its renewable energy capacity and has even bigger plans for the coming decade. While Egypt continues to rely heavily on fossil fuels, that could soon change thanks to high levels of private investment in green energy, supported by favourable national policies.

Egypt has significant potential to develop its solar and wind energy sectors, thanks to its favourable geographical conditions, with abundant land, including arid deserts, sunny weather, and high wind speeds. The North African country has some of the highest solar irradiance levels in the world, with between 2,000 and 3,200 kilowatt-hours (kWh) per square meter annually.

In recent years, the government has shown greater openness to energy diversification through private investment, supporting the aim of growing Egypt’s solar and wind capacity. The Integrated Sustainable Energy Strategy (ISES) 2035 builds upon previous national frameworks and establishes renewable energy as a core component of Egypt’s green transition.

The government aims to generate 42 per cent of electricity from renewable sources by 2030 and increase this to 60 per cent by 2040. It will do this by diversifying its energy mix to include wind, hydropower, photovoltaic solar, and green hydrogen.

The government has sought external support for its energy strategy and the development of a diversified energy mix, with the European Commission having contracted the management consulting firm Cowater International to assess Egypt’s energy strategy over the next two decades.

In line with a greater openness to private investment, the government had signed around 32 Power Purchase Agreements (PPAs) with private developers by 2025 to produce 1,465 MW of renewable energy, with additional agreements underway.

Egypt has already developed several large-scale renewable energy projects, including the 1.8GW Benban Solar Park, which is set for expansion. Meanwhile, AMEA Power’s additional 2 GW project with 900 MWh of battery storage and a 500 MW facility at the Abydos Kom Ombo Solar PV Park are under development.

In January, Egypt signed renewable energy deals worth a combined $1.8 billion. This is expected to help the North African country achieve its 42 per cent renewable electricity generation goal by the end of the decade. The agreements included projects with Norwegian renewable energy developer Scatec and China’s Sungrow.

The first project will be the development of a solar energy plant with Scatec to produce electricity and energy storage stations in Minya, Upper Egypt, according to the Egyptian government. The plant is expected to have a 1.7 GW capacity and incorporate 4 GWh of battery storage. Meanwhile, Sungrow will develop a battery manufacturing facility in the Suez Canal Economic Zone and will supply batteries to the Scatec plant. Scatec also signed a PPA to provide 1.95 GW of capacity and 3.9 GWh of battery storage systems.

In June, Egypt signed a deal with the European Union to deepen the two powers’ strategic partnership in renewable energy, agreeing to a financing package valued at up to $788 million to expand and upgrade Egypt’s electricity transmission network. The package includes a $686 million loan from the European Investment Bank’s development arm, EIB Global, and up to $103 million in European Commission grants.

The project will be led by the state-owned Egyptian Electricity Transmission Company (EETC), with the aim of powering the grid with 22 GW of renewable energy capacity, or enough to power 10 million homes, by the end of the decade. The agreement aligns with the EU-Egypt Strategic and Comprehensive Partnership and the Trans-Mediterranean Renewable Energy and Clean-Tech Cooperation Initiative (T-MED), which encourages renewable energy and cleantech cooperation between the European Union and southern Mediterranean countries.

The European Commissioner for the Mediterranean, Dubravka Šuica, explained, “Under its newly launched flagship initiative, T-MED, today we presented a major EU-supported project to strengthen and expand Egypt’s electricity infrastructure. This will reinforce Egypt’s role in the regional energy markets and create major business opportunities for local and European companies. It is another testimony of our shared commitment to sustainable growth, energy security and long-term prosperity in the Mediterranean.”

Meanwhile, Egypt’s Minister of Foreign Affairs, International Cooperation and Egyptian Expatriates, Badr Abdelatty, said, “This agreement reflects the strength of the partnership between Egypt and the European Union and our shared determination to advance the green transition. Together with the EIB and the EU, we are taking an important step to modernise our electricity network, strengthen energy security and create new opportunities for sustainable growth.”

In addition to growing its solar and wind power capacity, Egypt has big plans for green hydrogen development to support industrial decarbonisation. In February 2024, the Supreme Council of Energy approved the National Strategy for Low?Carbon Hydrogen. In January, partial production commenced at a 100-MW green hydrogen production project in the Suez Canal Economic Zone, ahead of a broader launch.

Egypt has rapidly developed its renewable energy capacity in recent years and could become a major player in the production and export of green hydrogen in the coming decades. The North African country is a good example of what targeted national policy and an openness to private investment can achieve.