8th of June, 2015
Egypt’s Feed-in-Tariffs Program: Briefing on Project Bankability and Finance Aspects
Partner Ahmed El Sharkawy and Senior Associate Mohamed Nabil authored a briefing on the issues/concerns that banks and financial institutions regard as crucial for the bankability of renewable power projects under Egypt’s FiT program, and what are the best mitigation strategies for banks and financial institutions to address those concerns.
On 17 September 2014, the Cabinet of Ministers announced the inauguration of Egypt’s feed-in tariff (FiT) program and invited investors to a pre-qualification submission. A few weeks later, the government released a shortlist of 110 qualified applicants for solar photovoltaic and wind FiT projects.
The off-taker under the FiT program will be either the Egyptian Electricity Transmission Company (EETC) – the country’s bulk power purchaser and sole operator of the grid – or distribution companies (depending on project sizes) pursuant to power purchase agreements of 25 years’ term for photovoltaic facilities and 20 years’ term for wind facilities.
While investors are flocking to gain a foothold in the first FiT regulatory period, banks and financial institutions are carefully observing in anticipation for the final project documentation (including the power purchase agreement – PPA). The released draft of the PPA is based on Egypt’s IPP precedents and the Suez wind farm BOO project. It is currently being reviewed by the qualified investors and the leading financial institutions to address its bankability.
The nature of renewable power projects – with their high upfront capital requirements and low operational costs – further emphasizes the bankability challenge. Hence, it is of paramount importance to highlight to the government the key bankability concerns for banks and financial institutions at these early stages of structuring and drafting in order to ensure that the draft PPA is issued in good shape for negotiation.
To read the full article, click here.
On 17 September 2014, the Cabinet of Ministers announced the inauguration of Egypt’s feed-in tariff (FiT) program and invited investors to a pre-qualification submission. A few weeks later, the government released a shortlist of 110 qualified applicants for solar photovoltaic and wind FiT projects.
The off-taker under the FiT program will be either the Egyptian Electricity Transmission Company (EETC) – the country’s bulk power purchaser and sole operator of the grid – or distribution companies (depending on project sizes) pursuant to power purchase agreements of 25 years’ term for photovoltaic facilities and 20 years’ term for wind facilities.
While investors are flocking to gain a foothold in the first FiT regulatory period, banks and financial institutions are carefully observing in anticipation for the final project documentation (including the power purchase agreement – PPA). The released draft of the PPA is based on Egypt’s IPP precedents and the Suez wind farm BOO project. It is currently being reviewed by the qualified investors and the leading financial institutions to address its bankability.
The nature of renewable power projects – with their high upfront capital requirements and low operational costs – further emphasizes the bankability challenge. Hence, it is of paramount importance to highlight to the government the key bankability concerns for banks and financial institutions at these early stages of structuring and drafting in order to ensure that the draft PPA is issued in good shape for negotiation.
To read the full article, click here.
Egypt’s Feed-in-Tariffs Program: Briefing on Project Bankability and Finance Aspects
8th of June, 2015
Partner Ahmed El Sharkawy and Senior Associate Mohamed Nabil authored a briefing on the issues/concerns that banks and financial institutions regard as crucial for the bankability of renewable power projects under Egypt’s FiT program, and what are the best mitigation strategies for banks and financial institutions to address those concerns.
On 17 September 2014, the Cabinet of Ministers announced the inauguration of Egypt’s feed-in tariff (FiT) program and invited investors to a pre-qualification submission. A few weeks later, the government released a shortlist of 110 qualified applicants for solar photovoltaic and wind FiT projects.
The off-taker under the FiT program will be either the Egyptian Electricity Transmission Company (EETC) – the country’s bulk power purchaser and sole operator of the grid – or distribution companies (depending on project sizes) pursuant to power purchase agreements of 25 years’ term for photovoltaic facilities and 20 years’ term for wind facilities.
While investors are flocking to gain a foothold in the first FiT regulatory period, banks and financial institutions are carefully observing in anticipation for the final project documentation (including the power purchase agreement – PPA). The released draft of the PPA is based on Egypt’s IPP precedents and the Suez wind farm BOO project. It is currently being reviewed by the qualified investors and the leading financial institutions to address its bankability.
The nature of renewable power projects – with their high upfront capital requirements and low operational costs – further emphasizes the bankability challenge. Hence, it is of paramount importance to highlight to the government the key bankability concerns for banks and financial institutions at these early stages of structuring and drafting in order to ensure that the draft PPA is issued in good shape for negotiation.
To read the full article, click here.
On 17 September 2014, the Cabinet of Ministers announced the inauguration of Egypt’s feed-in tariff (FiT) program and invited investors to a pre-qualification submission. A few weeks later, the government released a shortlist of 110 qualified applicants for solar photovoltaic and wind FiT projects.
The off-taker under the FiT program will be either the Egyptian Electricity Transmission Company (EETC) – the country’s bulk power purchaser and sole operator of the grid – or distribution companies (depending on project sizes) pursuant to power purchase agreements of 25 years’ term for photovoltaic facilities and 20 years’ term for wind facilities.
While investors are flocking to gain a foothold in the first FiT regulatory period, banks and financial institutions are carefully observing in anticipation for the final project documentation (including the power purchase agreement – PPA). The released draft of the PPA is based on Egypt’s IPP precedents and the Suez wind farm BOO project. It is currently being reviewed by the qualified investors and the leading financial institutions to address its bankability.
The nature of renewable power projects – with their high upfront capital requirements and low operational costs – further emphasizes the bankability challenge. Hence, it is of paramount importance to highlight to the government the key bankability concerns for banks and financial institutions at these early stages of structuring and drafting in order to ensure that the draft PPA is issued in good shape for negotiation.
To read the full article, click here.
Insights
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