(MENAFN- Daily News Egypt)
Toyota, Orascom, and GD France alliance awaits the New and Renewable Energy Authority (NREA) to complete the land allocation agreement for the Gulf of Suez wind farm and to complete financial closure and sign the power purchasing agreement with the Egyptian Electricity Transmission Company (EETC).
Sources at the Ministry of Electricity and Renewable Energy said that the terms have been agreed upon, that the land will be allocated soon, and that the power purchasing agreement is to be signed within two months.
The sources noted that the ministry agreed to moving arbitration outside of Egypt, but have not decided on a location yet.
The sources pointed out that the ministry will buy the energy at EGP 4.6 per kw/h, which is the cheapest price for wind energy.
The sources explained that the ministry agreed to move arbitration as the alliance did not change the price following flotation.
The Ministry of Finance had approved the government's guarantee of payment in case of dispute over the establishment of the Gulf of Suez wind farm, which sports a capacity of 250MW.
Based on the ministry's decision, the state will be responsible for providing official financial guarantees to pay the companies' dues if the Ministry of Electricity fails to pay the price of produced energy. Such guarantees are always provided for projects agreed to be implemented by the private sector.
The Ministry of Electricity will buy energy produced from the station for 25 years at a price that was agreed upon in accordance with the offer made in the tender. Furthermore, the ministry will sell the produced energy to the distribution companies.
The ministry had started negotiations with GD France, Toyota, and Orascom after its negotiations with Lekela Power-Actis—which had presented the lowest prices—were stalled, because the company did not complete the procedures and requirements announced by the ministry.
The ministry seeks to produce 20% of the total national electricity grid through new and renewable energy by 2020, as part of the ministry's plan to diversify its sources of energy production and sustainable development in the sector.
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