Egypt is racing against time to step up its green hydrogen production as a clean source of energy as part of its efforts to rely heavily on new and renewable energy.
The Egyptian government stressed the importance of the State’s orientation towards green hydrogen projects, as part of its interest in switching to clean energy, and working to reduce carbon emissions.
Green hydrogen is emerging as a profitable and viable alternative to fossil fuels, especially after the outbreak of the war between Russia and Ukraine, economist Alia el-Mahdy, professor at the Faculty of Economics and Political Sciences of Cairo University told Majalla.
The war has given rise to concerns about energy supply, amid calls for increasing dependence on less environmentally polluting energy sources, she said.
Cairo is answering these calls, even though its interest in the production of green hydrogen preceded the war outbreak, el-Mahdy said.
Rashad Abdo is an economics professor at Cairo University and head of the Egyptian Forum for Economic and Strategic Studies. He told Majalla that green hydrogen projects being carried out by Egypt are building the future of the energy sector in the country, as the green hydrogen as well as new and renewable energies generate zero pollution.
Egypt is expanding its implementation of green projects ahead of hosting the 2022 Conference of Parties to the United Nations Framework Convention on Climate Change (COP 27) to be held in Sharm el-Sheikh in November this year.
“Cairo is making great strides in the energy sector. Egypt wants to send a clear message to the whole world that it preserves environmental resources through switching to green energy,” explained Abdo.
He noted that green hydrogen is a new revolution in clean new and renewable energy, adding that Egypt has an excellent opportunity to make inroads in this promising field among big global partners.
Egypt has clinched a number of agreements and memoranda of understanding with major international corporations in this sector, including Norwegian and Emirati firms.
Abdo went on to say that during the COP27 conference, Egypt could confirm a raft of pacts with giant global corporations and get financial grants to expand in green projects nationwide.
He stressed that the Egyptian State is working to encourage investment in green energy projects, owing to Egypt’s potentials to become an important pivotal and regional hub in this vital sector that is expected to transform the global energy system during the upcoming period.
These projects will also accelerate the energy transition process in the region, he added.
The Egyptian government plans to announce a list of projects for the production of green hydrogen in the near future.
These projects, it said earlier this year, would be part of a national initiative.
Egypt also has plans for incorporating green hydrogen production into its Energy Strategy for 2035.
The government is intensifying efforts to diversify energy sources, whether from traditional sources, or using solar and wind energy.
The State is making great strides to expand renewable energy projects, and to encourage the private sector to participate in these projects.
President Abdel Fattah El Sisi directed the government in July last year to formulate a national strategy for the production of green hydrogen and present this plan during COP27 climate summit.
In late May this year, President Sisi met with Chairman of the Suez Canal Economic Zone (SCZone), Yehia Zaki, and Minister of Electricity and Renewable Energy, Mohamed Shaker, to discuss the methods for raising electricity production from renewable energy to 42 per cent.
Egypt is not alone in giving so much attention to the production of this clean fuel.
Several other countries around the world, such as Australia, France, India and Brazil, are taking similar steps by announcing their own national plans for the production of green hydrogen.
Some Arab countries are close to producing green hydrogen as well, including the United Arab Emirates where state-owned company ADNOC signed an agreement in this regard with the Spanish company Cepsa.
Morocco and Germany also hammered out a partnership to build Morocco's first green hydrogen plant.
Egypt, for its part, wants to transform the SCZone into a regional green energy hub, hoping to use the investment momentum generated by COP27 preparations to fulfill this goal.
Egypt has signed six memoranda of understanding (MoUs) with international companies, including Norway's Scatec, the Abu Dhabi Future Energy Company, Hassan Allam Holding, Egyptian Inara Capital, Danish Maersk, France's EDF Alliance and the UAE's AMEA Power, to start the production of green hydrogen.
The SCZone also signed a memorandum of understanding with the Sovereign Fund of Egypt, the New and Renewable Energy Authority, the French Total Alliance and Inara Capital for the implementation of a project that will produce 300,000 tons of green ammonia.
Masdar and Hassan Allam Holding also signed an agreement to set up green energy plants in the SCZone and on the Mediterranean coast.
These projects are expected to produce 480,000 tons of green hydrogen.
Hassan Allam, the chairman of Hassan Allam Holding, says that his company will establish a green hydrogen plant that will start operating in 2026.
Allam say that the plant will produce 100,000 tons of green methanol annually.
This methanol, he adds, would be used to fuel cargo ships transiting the Suez Canal.
Meanwhile, Head of the SCZone Yehia Zaki held a recent meeting with senior officials of the European Bank for Reconstruction and Development in London on May 20.
He referred to $10 billion in hydrogen and green ammonia investments in Egypt, and expected Egypt to produce close to 2 million tons of both green hydrogen and ammonia annually.
"We expect more investments to be poured in this sector in the coming period,” he said.
Zaki added that the government sought to be experimenting with the operation of green hydrogen projects by 2025 or 2026.
He revealed that between $15 billion and $17 billion in investments are needed to raise the production to 5 million tons.
Part of this money, Zaki said, would be used for solar and wind power projects in areas other than the SCZone.
The government also works to attract investments, including the support of local and foreign investors.
Prime Minister Moustafa Madbouli announced the formation of an independent unit to follow up on investor problems, remove challenges and facilitate investment procedures in all sectors.
The Prime Minister said that the Egyptian state is working hard to develop the energy strategy to include green hydrogen as an energy source, which would be a major step for Egypt to become a regional main hub for new and renewable energy, in line with the Sustainable Development Strategy (SDS): Egypt Vision 2030.