(MENAFN - Daily News Egypt) class="p1">High-level government sources revealed that the cabinet approved in principle to the amendment of the system of implementation of the wind farm projects from feed-in tariff to build, own, operate (BOO), and to put the Ministry of Electricity in charge of setting regulations in coordination with investors.
The sources added that Minister of Electricity Mohamed Shaker presented a detailed memorandum to former Prime Minister Sherif Ismail on the inability of investors to finance the wind energy projects, because of the reluctance of foreign banks to finance them, given the low value of purchasing power.
He also presented the demands of investors on the implementation of power plants on BOO, which was approved in principle. The Current Prime Minister Mostafa Madbouly is expected to issue a decision approving the projects, after the Ministry of Electricity sets the regulations.
Arab and international companies are waiting for the decision to implement the projects and seek to inject direct investments for the establishment of wind farms.
The sources added that the price of energy produced from the wind stations will not exceed $0.38 cents per kW, which is the value contracted by the Egyptian Electricity Holding Company with the Toyota-Orascom-GD France alliance.
The Egyptian Electricity Transmission Company signed an agreement to establish a wind farm with the Toyota-Orascom-GD France alliance. The project will sell energy at $0.38 cents per kW.
The official said that the procedures following the termination of the feed-in tariff programme include withdrawing the lands and submitting measurements and studies, along with other legal procedures.
Work began on the second phase of the feed-in tariff projects on 28 October 2016. Since announcing the purchasing price, investors have been dissatisfied with the low value, which also pushed international institutions to reject project financing.
According to the regulations for the implementation of the phase, investors have to finalise financial closure within 18 months starting from 28 October 2016 and to submit a letter of commitment from foreign financiers, within a period of 12 months for wind energy projects.