Egypt Allocates $6 Billion to Upgrade Power Grid, Support Renewable Energy Expansion
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Prime Minister Mostafa Madbouly witnessed the signing of a protocol agreement to finance projects aimed at strengthening Egypt’s national electricity grid, according to multiple government officials. The deal, finalized by the Ministry of Electricity and Renewable Energy, the Ministry of Finance, and the Ministry of Planning, allocates EGP 60bn to the Egyptian Electricity Transmission Company (EETC) to support grid modernization and expansion.
The agreement was formalized during a ceremony attended by Minister of Electricity and Renewable Energy Mahmoud Esmat, Minister of Finance Ahmed Kouchouk, and Minister of Planning, Economic Development and International Cooperation Ahmed Rostom. The funds are intended to enhance EETC’s financial and operational capabilities, enabling the implementation of critical infrastructure projects.
Madbouly emphasized the government’s commitment to expanding renewable energy capacity, stating that investments in the electricity grid are essential to accommodate planned solar and wind energy projects. “Continuing to modernize transmission, distribution, and evacuation networks is vital to meet growing demand and integrate renewable energy sources,” he said.
Esmat, the electricity minister, highlighted that grid expansion is a “continuous process” to ensure stability and reliability. He noted that accelerated timelines for solar and wind projects align with Egypt’s goal of increasing renewable energy’s share of the electricity mix to 45% by 2028. “This will support major national development projects and drive economic growth,” he added.
Kouchouk, the finance minister, reiterated the Ministry of Finance’s commitment to renewable energy infrastructure. He stated that strengthening the grid would improve electricity supply for citizens and investors, bolstering Egypt’s industrial and export sectors.
Rostom, the planning minister, described the agreement as a “model of integration” between financial and investment policies. She emphasized that the EGP 60bn allocation represents a strategic investment in infrastructure, aiming to attract domestic and foreign capital while encouraging private-sector participation.
The move comes as Egypt seeks to diversify its energy mix, reduce reliance on fossil fuels, and enhance energy security. The government has previously outlined plans to increase renewable energy capacity, including the development of large-scale solar farms and wind projects in the Gulf of Suez and the Red Sea region.
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Key Details of the Protocol Agreement
The EGP 60bn funding will target upgrades to Egypt’s electricity transmission network, including the expansion of high-voltage lines and the modernization of substations. These projects are expected to improve grid efficiency and reduce energy losses, which currently stand at around 10% according to the Egyptian Electricity Transmission Company.
The agreement also includes measures to enhance the grid’s ability to absorb renewable energy, which has grown rapidly in recent years. Egypt’s renewable energy capacity reached 7.5 GW in 2025, with solar and wind projects contributing significantly to this figure.
Esmat stated that the modernization efforts will ensure the grid can handle the increased output from planned projects, such as the Beni Suef Solar Park and the Zafarana Wind Farm. “This is critical to maintaining stability as renewable energy becomes a larger portion of the energy mix,” he said.
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Government Officials Highlight Strategic Importance
Rostom emphasized that the investment aligns with Egypt’s broader economic development strategy. “This is not just sector-specific financing but a strategic move to build infrastructure that supports long-term growth,” she said.
The agreement also addresses challenges related to electricity demand, which has risen by 4% annually over the past decade. With Egypt’s population projected to reach 130 million by 2030, grid capacity is a priority for policymakers.
Kouchouk noted that the funding will help stabilize electricity prices for consumers. “A reliable grid reduces the risk of power outages and ensures affordable energy for households and businesses,” he said.
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Context and Broader Implications
Egypt’s renewable energy transition is part of its broader sustainability goals, including a target to achieve net-zero emissions by 2050. The government has partnered with international organizations, such as the World Bank and the European Investment Bank, to finance green projects.
The EGP 60bn allocation follows a 2023 agreement to invest EGP 150bn in renewable energy infrastructure over five years. This latest funding underscores the government’s continued focus on energy sector reforms.
Analysts suggest that the grid upgrades will also attract foreign investment. “A modern, reliable grid is a key factor for investors in the energy and manufacturing sectors,” said a report by the Cairo-based Economic Research Foundation.
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Next Steps and Challenges
While the agreement marks a significant step, challenges remain. Grid modernization requires coordination between multiple ministries and private sector partners. Additionally, ensuring timely implementation of projects will be critical to meeting the 2028 renewable energy target.
Esmat acknowledged these challenges but expressed confidence in the plan’s execution. “We are working closely with international experts and local engineers to ensure projects are completed on schedule,” he said.
The government has also announced plans to introduce smart grid technologies, which could further improve efficiency and reduce losses. These technologies, including automated monitoring systems and advanced metering infrastructure, are expected to be deployed in pilot projects by 2027.
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Conclusion
The EGP 60bn investment in Egypt’s electricity grid reflects the government’s prioritization of renewable energy and infrastructure development. By modernizing transmission systems, Egypt aims to support its growing energy demands while advancing its sustainability objectives. The success of this initiative will depend on effective implementation, continued international collaboration, and the ability to adapt to evolving energy needs.