- The Red Sea Wind Energy (RSWE) consortium announces the financial close of its second wind farm in the Gulf of Suez, Egypt.
- The 500 MW wind farm is financed by a myriad of development partners.
Red Sea Wind Energy (RSWE) has completed another significant step in the development of its second wind farm in Egypt’s Gulf of Suez. The second project, which intends to develop an installed capacity of 500 MW, has reached its financial close, according to the business. The Japan Bank for International Cooperation (JBIC), in collaboration with Sumitomo Mitsui Banking Corporation, Norinchukin Bank, and the French bank Société Générale, is funding this second initiative.
Guarantees from the European Bank for Reconstruction and Development (EBRD) and Nippon Export and Investment Insurance are used to support the loans made by these financial institutions (NEXI). HSBC Bank Egypt, a division of the British banking giant, serves as an “onshore” working capital bank and security agent. The participation of several Japanese financial institutions in this project confirms the return of Japan in Africa, announced at the 8th Tokyo International Conference on African Development (TICAD-8) in 2022 in Tunisia.
Japan seeks to challenge China’s investment, which has multiplied in recent years in Africa. According to the United Nations Conference on Trade and Development, Beijing’s investment flows have surged by 35%, reaching $8.2 billion in East Africa alone in 2021. (UNCTAD). Yet, the money will enable RSWE to quicken the construction of its project in the Gulf of Suez, close to Ras Ghareb.
The consortium’s experience in creating a first 262 MW project, which has been in commercial operation since 2019, serves as the foundation for this new 500 MW wind farm project. Since November 2022, work has been ongoing on the wind farm, which is anticipated to begin making money in the third quarter of 2025.
A 25-year power purchase agreement (PPA) between RSWE and the Egyptian Electricity Transmission Company has already been made about the project (EETC).
More than 800,000 Egyptian homes will be able to get clean electricity thanks to the wind farm that is now being built, said RSWE. Also, it will hasten Egypt’s switch to renewable energy sources and, if operational, will result in an annual CO2 reduction of almost 1 million tons. To be clear, the consortium that owns RSWE is made up of the French energy giant Engie (35%), the leading Egyptian contractor Orascom Construction (25%), the Japanese investor Toyota Tsusho Corporation (20%), and its domestic partner Eurus Energy Holdings Corporation (20%).