The Egyptian Market: An Insight

Written by Haneen Gamal
Edited by Malak Manie

An overview of the Egyptian market

According to investors, the current Egyptian energy market can be considered to be attractive, due to a relatively stable economy and government. The country is witnessing some interesting advancements: from mega projects and technological enhancements to a solid strategy to ensure further diversification of the energy mix. However, the ever-worsening surplus problem poses a threat to all industry stakeholders, including us: aspiring energy engineers.

Renewable Energy

Globally, Egypt is one of the most favorable regions for exploiting renewable energy, namely solar and wind energy. With Egypt’s Sustainable Development Strategy: Egypt’s Vision 2030 (An important read for anyone interested in where the country is going; I’ll link it down below), the Egyptian government is pushing towards reaching a total of 40% in terms of diversification in the electrical grid (i.e. 40% of the generated electrical power will be supplied from renewable energy sources).

Solar energy is ever booming in Egypt, especially with the 40 billion EGP Benban Solar Park, which is set to be the largest solar park in the world, producing a total capacity of 1650 MWp, enough to provide clean energy to more than 350,000 homes. Nevertheless, supporting the widespread of solar cells residentially and commercially, the Egypt-PV project enforced by the United Nations Development Programme in partnership with the Industrial Modernisation Centre opted for 50 local solar companies to achieve highest standards of quality in design, installation, commissioning and maintenance of photovoltaic systems.

Wind energy, however, is impeded by the turbines’ expensive cost and the military restrictions posed on the overall length of wind turbines (they must be no longer than 100 meters). Be that as it may, the 12 billion EGP Gabal El Zeit wind farm is one of the world’s largest electricity-generating plants in terms of area, the number of turbines and capacities generated. Supplying 580 MW and composing of 300 turbines, the farm was implemented by the Spanish company “Gamesa” and connected to the national grid in November 2018. The sad news is that the 20-year-old 30 MW wind farm in Zafarana’s lifetime is coming to an end, which will definitely affect the amount of local renewable energy.

Distribution Control Centers

A distribution control center is the pièce de résistance of a smart grid. Before discussing the country’s smart grid outlook, one must first ask what differs a smart grid from a traditional one: Smart grids allow electricity distribution companies to analyze big data on electricity consumption. This is achieved through servers and IT infrastructure installed in control centers, allowing the electrical system to become more reliable and efficient as problems are anticipated before they occur, maneuvers are performed to avoid interruptions and cut-back on lost electricity is realized.

The first-ever nationwide smart grid project in the Middle East includes replacing Egypt’s current 6 control centers with 47 smart control centers established nationwide and estimated to cost 4 billion euros.  The first phase of work has already begun, although covid-19 has definitely slowed things down a bit. Among the companies which won the bid is Schneider Electric, signing an agreement on July 12th to build 4 smart control centers, as well as over 12,000 smart ring main units, at 254 million euros and in the course of 18 months. After the completion of the first phase, the Ministry of Electricity will offer more contracts for the remaining centers depending on priority and needs.

Surplus Problem

The current peak generation capacity in Egypt amounts to about 58 gigawatts, while the local peak consumption occurring in the summer season ranges between 30-32 gigawatts. This means that there is a surplus ranging between 26-28 gigawatts, and even exceeding that in the winter season. Plans to install power linkage lines with neighboring countries are in action, facing obstacles, however, due to the Saudi Arabian electrical surplus and Europe’s apparent saturation.

This problem, the outcome of unplanned power generation diversification and expansion, affects us directly as upcoming energy engineers as it means that the country is currently uninterested in energy management and optimization and more focused into solving the surplus problem.

Microgrids

Microgrids are a circulating topic in Egypt’s research communities, bringing in a whole new world of possibilities. A microgrid is a self-sufficient energy system serving a particular geographic area of land by using one or more source of distributed energy, such as solar panels, wind turbines, generators, etc. Microgrids are local, meaning they generate energy from nearby sources or plants without the need for transporting electricity over long transmission and distribution lines. Microgrids can also operate independently or be connected to the main electrical grid. The microgrid controller, which is the central brain of the system, is a sophisticated component which manages the generation, batteries and building systems to meet the system’s energy goals, and thus, makes the microgrid inherently intelligent.

References

“Benban”, the Largest Solar Power Plant in Aswan. (2018, July). Retrieved from The Arab Republic of Egypt Presidency: https://www.presidency.eg/en/%D8%A7%D9%84%D9%85%D8%B4%D8%A7%D8%B1%D9%8A%D8%B9-%D8%A7%D9%84%D9%82%D9%88%D9%85%D9%8A%D8%A9/%D8%A8%D9%86%D8%A8%D8%A7%D9%86-%D8%A3%D9%83%D8%A8%D8%B1-%D9%85%D8%AD%D8%B7%D8%A9-%D9%84%D8%A5%D9%86%D8%AA%D8%A7%D8%AC-%D8%A7%D9%84%D8%

Al-Wali, M. (2020, August 19). Egypt’s Enormous Electricity Surplus – Achievement or Impasse? Retrieved from Egyptian Institute for Studies: https://en.eipss-eg.org/egypts-enormous-electricity-surplus-achievement-or-impasse/#:~:text=The%20Egyptian%20government%20boasts%20that,which%20means%20that%20the%20surplus

Egypt Power Report 2020 – Egypt’s Electricity Surplus Could Reach 74GW by 2035 – ResearchAndMarkets.com. (2020, June 11). Retrieved from Business Wire: https://www.businesswire.com/news/home/20200611005434/en/Egypt-Power-Report-2020—Egypts-Electricity-Surplus-Could-Reach-74GW-by-2035—ResearchAndMarkets.com

Egypt Power Report 2020. (2020, February). Retrieved from Research and Markets: https://www.researchandmarkets.com/reports/5086955/egypt-power-report-2020?utm_source=dynamic&utm_medium=BW&utm_code=g3bp8r&utm_campaign=1400683+-+Egypt+Power+Report+2020+-+Egypt%27s+Electricity+Surplus+Could+Reach+74GW+by+2035&utm_exec=joca220bwd

Egypt Today. (2020, July 14). Electricity min.: LE4.6B cost of implementing 4 power control centers. Retrieved from Egypt Today: https://www.egypttoday.com/Article/3/89673/Electricity-min-LE4-6B-cost-of-implementing-4-power-control

Enterprise. (2020, August 19). With a surplus of electricity, why do we still get power cuts – part 2. Retrieved from Enterprise: https://enterprise.press/stories/2020/08/19/with-a-surplus-of-electricity-why-do-we-still-get-power-cuts-part-2-20546/

GE, Schneider Electric to implement four power control centres in Egypt. (2019, July 24). Retrieved from Zawya: https://www.zawya.com/mena/en/business/story/GE_Schneider_Electric_to_implement_four_power_control_centres_in_Egypt-SNG_149934854/

Indicative list of executing companies. (2019, January). Retrieved from Egypt-PV: https://egypt-pv.org/wp-content/uploads/2019/02/%D8%A7%D9%84%D9%82%D8%A7%D8%A6%D9%85%D8%A9_%D8%A7%D9%84%D8%A5%D8%B3%D8%AA%D8%B1%D8%B4%D8%A7%D8%AF%D9%8A%D8%A9_%D9%84%D9%84%D8%B4%D8%B1%D9%83%D8%A7%D8%AA_%D9%8A%D9%86%D8%A7%D9%8A%D8%B1_2019.pdf

Largest Power Plant in Gabal El Zeit. (2018, July). Retrieved from The Arab Republic of Egypt Presidency: https://www.presidency.eg/en/%D8%A7%D9%84%D9%85%D8%B4%D8%A7%D8%B1%D9%8A%D8%B9-%D8%A7%D9%84%D9%82%D9%88%D9%85%D9%8A%D8%A9/%D9%85%D8%B4%D8%B1%D9%88%D8%B9-%D8%A5%D9%86%D8%B4%D8%A7%D8%A1-%D8%A3%D9%83%D8%A8%D8%B1-%D9%85%D8%AD%D8%B7%D8%A9-%D9%84%D8%A5%D9%86%D8%

PV Companies. (2020). Retrieved from Egypt-PV: https://egypt-pv.org/pv-companies/?lang=en

Schneider Electric. (2020, July 7). Schneider Electric to build four control centers for Egypt’s national energy grid. Retrieved from Schneider Electric: https://www.se.com/ww/en/about-us/newsroom/news/press-releases/schneider-electric-to-build-four-control-centers-for-egypt%E2%80%99s-national-energy-grid-5f0ece5929490d6702214d3a

Schneider Electric signs agreement with Egypt to build power control centers. (2020, March 3). Retrieved from Energy Egypt: https://energyegypt.net/schneider-electric-signs-agreement-with-egypt-to-build-power-control-centers/

Smart grids: what is a smart electrical grid – electricity networks in evolution. (n.d.). Retrieved from i-SCOOP: https://www.i-scoop.eu/industry-4-0/smart-grids-electrical-grid/#:~:text=A%20smart%20grid%20is%20an%20electricity%20network%20enabling%20a%20two,customers%20to%20become%20active%20participants

Sustainable Development Strategy: Egypt vision 2030. (2016, May). Retrieved from Green Growth: https://www.greengrowthknowledge.org/sites/default/files/downloads/policy-database/Egypt%20Vision%202030%20%28English%29.pdf

United Nations. (n.d.). Gabel El Zeit Wind farm complex (Ensuring access to affordable, reliable and modern energy for all). Retrieved from United Nations Sustainable Development Goals Partnership Platform: https://sustainabledevelopment.un.org/partnership/?p=29586

Wood, E. (2020, June 24). What is a Microgrid? Retrieved from Microgrid Knowledge: https://microgridknowledge.com/microgrid-defined/#:~:text=A%20microgrid%20is%20a%20self,generators)%20that%20produce%20its%20power

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