Egypt is a beacon of opportunity in the renewable energy sector in a rapidly evolving global energy landscape.
To delve deeper into this promising investment climate, Ahram Online interviewed Daniel Calderon, Co-founder and Managing Partner of Alcazar Energy Partners, a Luxemburg-domiciled sustainable infrastructure fund focused on utility-scale renewable energy projects in emerging markets
Ahram Online: How do you see Egypt’s investment climate in Egypt, especially the atmosphere in the renewable energy sector?
Daniel Calderon: Last year the Egyptian government awarded six memorandums of understanding (MoUs) for a total of c.9 GW of wind and solar capacity. This is a prime example of why Egypt remains such a compelling market for renewable energy investment.
Its strategic location, favourable solar and wind resources, and continued commitment to building renewable capacity all contribute to its suitability for investment.
The government’s ambitious targets, including increasing the share of renewables in the energy mix to 42% by 2035, provide a clear roadmap for investors and developers alike.
Despite persistent macroeconomic challenges — such as currency volatility, high inflation, and external debt pressures — Egypt’s well-established Independent Power Producer (IPP) framework and strong track record in implementing large-scale wind and solar projects offer strong fundamentals for long-term investment and make it a hugely important location for Alcazar Energy.
AO: What key challenges does the sector face in Egypt and how can they be dealt with?
DC: The Egyptian renewables sector faces a few key challenges:
• Grid Integration & Curtailment Risks: Egypt has seen rapid expansion in renewable capacity, but grid infrastructure must keep pace to accommodate intermittent energy sources. Investment in grid reinforcement and storage solutions will be crucial.
• Foreign exchange (FX) Liquidity & Payment Delays: Currency volatility and liquidity pose risks to projects. Addressing those concerns and ensuring timely payments from off-takers like the Egyptian Electricity Transmission Company (EETC) is key.
• Financing & Capital Costs: Rising global interest rates have increased the cost of capital, burdening project economies and increasing emphasis on large-scale projects with strong fundamentals.
• Policy Stability & Regulatory Clarity: While Egypt has made significant progress in renewable energy policy, consistency and transparency in regulations will be essential to sustaining investor confidence.
To address this, Egypt must prioritize regulatory certainty, maintain the bankability of renewable projects, and accelerate infrastructure investments, particularly in transmission networks. We’re confident that Egypt has the processes to overcome these challenges.
AO: Would you tell us about your latest collaboration with the Egyptian government via EETC and the New and Renewable Energy Authority (NREA)?
DC: In November last year, we signed an MoU with Egypt's EETC and NREA to develop a 2-GW onshore wind project under a Build-Own-Operate (BOO) framework.
The MoU, which includes a long-term Power Purchase Agreement (PPA) with EETC and a land allocation agreement with NREA, demonstrates our long-standing relationship with the Egyptian authorities.
We are extremely proud to continue our partnership with Egypt’s government and to invest in such an exciting market.
AO: Alcazar Energy Partners has a record of investing in and developing utility-scale renewable energy projects in emerging markets. What opportunities and challenges do you see in them amid global and regional tensions?
DC: We remain optimistic about the long-term fundamentals of renewable energy in emerging markets.
Emerging markets continue to offer strong growth potential for renewables investment, driven both by an increasing energy demand and supportive government policies.
Additionally, the expansion of battery storage solutions offers further avenues for investment, particularly in regions with strong existing renewable energy credentials.
Whilst challenges around rising capital costs, high inflationary headwinds, and regulatory uncertainty undoubtedly remain, there is a real sense of optimism about the long-term fundamentals of renewables in emerging markets, especially in places like Egypt and the Western Balkans, where governments continue to prioritize energy security and the transition to clean power.
We believe investing in emerging markets offers a great opportunity to create a positive social impact at national, regional, and local levels. By creating employment opportunities, engaging local service providers, and capacity building, we ensure that all our projects benefit the communities in which they are being developed.
AO: Alcazar has been investing in Egypt since 2022. Why did you identify Egypt as a market for investment, and what is your outlook for the Egyptian renewables sector in 2025?
DC: We have been active in Egypt since 2014 and remain optimistic about its renewable sector. This is based on several factors:
• Exceptional Renewable Resources: The Gulf of Suez and Western Desert have some of the best wind and solar conditions globally and benefit from good land availability.
• Government Commitment: The Egyptian government has demonstrated strong policy support, enabling the development of large-scale IPP under a clear regulatory framework.
• Strategic Location & Regional Connectivity: Egypt’s potential as a regional energy hub, with interconnection projects linking it to Europe and Africa, enhances its long-term value as a renewable energy leader.
• Knowledge and Skills Already Present Due to Industry Experience: Egypt has a highly skilled workforce with long-standing knowledge of the renewable energy sector. Combined with the number of high-quality local engineering, procurement, and construction companies, Egypt is a location where complex infrastructure projects can be implemented, attracting investors such as Alcazar Energy.
AO: What about your outlook for the Egyptian market in 2025?
DC: Despite continued macroeconomic challenges, Egypt remains a key market for renewable energy investment, supported by the government’s ambitious 2035 renewable energy strategy.
Ongoing private sector participation, financed by international institutions and Development Finance Institutions (DFI), can be expected this year, further contributing to a positive investment outlook and an important market for regional renewable energy advancement. While challenges persist, Egypt's strong fundamentals and strategic vision position it as a leading renewables market in the MENA region.
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