Yearend Leads, New Formula For Green Energy

Finance Minister Mohamed Maait in September said, “Egypt aims to make best use of this development with plans to double its revenues from natural gas exports to US$1 billion per month”.

According to the report, the government’s electricity rationing strategy was announced in August and aims to decrease the amount of natural gas used in generating domestic electricity in order to export around 15 percent of the gas currently allocated to the nation’s power stations.  

The strategy includes decreasing street lighting, electricity rationing in public areas such as government buildings and social clubs, and putting limits on the use of air conditioning in malls.

Late November Minister of Petroleum and Mineral Resources Tarek Al-Molla said, “Egypt aims to boost its LNG exports by 14 percent to eight million tons per year in 2022, as it sought to plug the hole left by lower Russian imports to the EU”.

He further added in the military statement, It exported 4.7 billion cubic metres (bcm) of LNG in the first five months of 2022 and 8.9 billion bcm during last year as a whole. About 90 per cent of this year’s LNG exports have headed to EU countries, compared with 80 per cent in 2021.

According to the report, While renewable energy was already high on the national agenda even before the war, experts think that the present market instability has made alternative resources even more appealing, paving the way for a greener future.

Global challenges in the energy markets following bans on Russian gas and oil exports have prompted policymakers to take action, Mohamed Al-Khayat, chairman of the New and Renewable Energy Authority (NREA), told Al-Ahram Weekly, adding that such challenges were also catalysts for greening the future.

A year ago, Minister of Electricity and Renewable Energy Mohamed Shaker announced 2022 would be the “Year of Green Hydrogen”, stated the report.

He said in December 2021 that the ministry would use solar and wind energy to electrolyse water to generate green hydrogen in what could be one of the cheapest ways of producing renewable energy. 

Green hydrogen could be fuel of the future, he emphasised, envisioning that this would extend beyond 2022 to stretch over the next 10 years.

In October this year, the electricity minister reiterated Egypt’s potential of producing green hydrogen at the lowest cost in the world by 2050, saying that its price could stand at US$1.7 per kg.

The Weekly stated, Green hydrogen is considered the missing piece of the global energy transition and will play a pivotal role in meeting the global target of net zero by 2050 .

The report further added, recent months have seen dozens of initial agreements and memoranda of understanding (MoU) to produce green hydrogen in the zone. Some estimates put the value of green hydrogen and ammonia projects in the pipeline at US$64 billion.

A host of companies has been conducting feasibility studies for green hydrogen and ammonia projects this year after signing MoUs worth billions of dollars.

 The biggest project was an agreement with Maersk to work on a huge US$15 billion facility capable of producing three million tons of fuel a year.

FFI’s Kandil told The Weekly that Egypt is one of its key markets globally, born out by the signing during the COP27 of a binding framework agreement with the Egyptian government on working together to study and develop large-scale multi-billion-dollar green hydrogen and renewable energy projects in Egypt. 

Egypt was one of the first countries in the region to have produced and used green hydrogen, when the Egyptian Chemical Industries (KIMA) company started producing it via hydroelectricity supplies from the Aswan Dam, stated the report.

“All the world’s countries are in a race to build a strong base and attractive infrastructure to attract developers to host their projects. Egypt has been one of the countries that has been presenting itself as a strong destination as a green hydrogen hub regionally and globally,” Kandil said.

Report concludes, green hydrogen can be produced from water using renewable energy sources and can play a significant role in decarbonising hard-to-abate sectors such as heavy industries like steel, cement, and transportation, Kandil explained.

By Sumita Pawar