By: Utilities Middle east

Egypt and Germany have signed a new €50 million debt-swap agreement that will finance key renewable energy and grid-enhancement projects as part of Egypt’s wider energy transition strategy.

Under the deal, the funds—provided by the German government—will be converted into a grant delivered in two tranches of €25 million each. According to the news report by Zawya, the financing will support two projects to connect the Ras Ghareb and Gabal El Zeit wind farms in the Gulf of Suez to the national electricity grid, helping advance private-sector participation in Egypt’s clean energy market.

The agreement aligns with Egypt’s strategy to increase the share of renewable energy in its generation mix, reduce dependence on fossil fuels, cut carbon emissions, and build a more sustainable energy system.

Electricity Minister Mahmoud Esmat highlighted the country’s ongoing work to modernise its electricity grid, shifting from a traditional network to a smart, flexible system capable of integrating higher levels of renewable generation. He also emphasised Egypt’s targets of surpassing 42% renewables in the power mix by 2030 and more than 65% by 2040.

This latest agreement builds on two previous Egypt–Germany debt-swap deals totalling €75 million, which were aimed at strengthening the national grid, partially financing upgrades to the Aswan hydroelectric power station, and supporting the establishment of a centre to manage distributed renewable energy.