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Suez Cement to invest in a renewable energy project

Euromoney Egypt conference continues with decision to invest in a wind farm to address energy crisis

Marwa Hussein, Tuesday 16 Sep 2014
Power-generating windmill turbines
Power-generating windmill turbines of The Zafarana project, Egypt (Photo: Al-ahram)
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Suez Cement, Egyptian subsidiary company of Italcementi Group is investing in a joint project with Italgen to construct a wind farm, Omar Mohana, CEO of the company told Ahram Online on the margins of the Euromoney conference.

The first phase aims to produce 120 megawatts before the end of 2015 with about LE1.4 billion ($200 million) worth of investment.

Two other phases with a similar production capacity will follow.

Mohana says that his company is producing hardly above 50 percent of its capacity due to an energy and fuel shortage, hence its desire to invest in wind energy.

"The production will be transferred to the national electricity grid as any other electricity generated and we will get our needs from the grid," he said.

Mohana is mainly worried about pricing as wind energy is more costly than energy generated from traditional fuel.

"The government proposed LE0.85 per kilowatt, which is a good price but we heard that they want to limit the production capacity of a wind farm to 50 megawatts, I hope this is not going to happen as it will be cost ineffective,"' he added.

The electricity ministry pays an average price of LE0.47 to produce one kilowatt of energy per hour, while the average selling price registers LE0.22, Mohamed El-Yamany, the ministry's spokesperson, told Ahram online in July.

To solve the energy shortage problem, Suez Cement is opting for an energy mix that will also include carbon. Before the end of the month, the company will operate its Qatameya cement factory with carbon. By the end of November the Suez plant will follow.

To defend the choice of environmentally unfriendly carbon as a replacement of the rare natural gas, Mohana underlined that Egypt is the only country worldwide not to use charcoal in cement production.

"Up to 80 percent of European production of cement and 60 percent in the USA is generated by carbon," he said.

Suez Cement market owns 18 percent of the market share with a total production capacity of 11 million tonnes per year.

In a session dedicated to energy during the conference connecting high executives to officials, Giuseppe de Beni, managing director of Italgen said that Egypt needs to work faster to solve its energy problem.

"We started at the same time to work on wind energy in Italy, Morocco and Egypt. Production started three years ago in the other countries while it will start in Egypt this year, we need a different speed,"' he said.

Mohamed El-Mahdi, chief executive officer of Siemens Egypt said that Egypt needs to address demand as well as supply side of its energy.

"It is not normal is to have an economy growing by 2 percent and energy demand growing by six or seven percent,"' he said.

He advocated for a modification of building and manufacturing codes as well as the replacement of electric water heaters with solar heaters. 

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