The world is currently focused on reducing carbon emissions in generating energy and using it to face climate change. Accordingly, Egypt is keen to expand the production and usage of green hydrogen as a clean energy source. The country has been signing contracts and adapting several initiatives to promote Green Hydrogen and prepare for its Green Hydrogen Strategy.
Green Hydrogen Incentives
Egypt has been working on boosting green hydrogen business. The country has signed several memoranda of understandings (MoUs) and contracts to produce green hydrogen.
In May 2023, Egyptian Minister of Finance Mohamed Maait revealed a green hydrogen production incentive ranging between 33% and 55% of tax dues. Moreover, in the same month, the Egyptian Cabinet granted approval to a draft law aimed at boosting green hydrogen projects and their related ventures. The draft law includes establishing green hydrogen plants, as well as desalination plants that assign a part of their output to green hydrogen. The law further includes renewable energy facilities that are dedicating at least 95% of their production to green hydrogen and desalination plants. Additionally, it covers projects set for the storage; transportation; and distribution of green hydrogen. It also included ventures manufacturing raw materials needed for the green hydrogen plants.
This comes as the European Bank for Reconstruction and Development (EBRD) is working closely with the European Union (EU) to support green hydrogen projects in the Suez Canal Economic Zone, as work is underway to launch a green hydrogen strategy in Egypt in cooperation with the Ministries of Electricity and Petroleum, Heike Harmgart, Executive Director of the Southern and Eastern Mediterranean Region at EBRD, told the Middle East News Agency in May.
Green Hydrogen Strategy
In May 2023, Prime Minister Mostafa Madbouly witnessed the conference to launch the new country strategy between Egypt and the World Bank Group for the period 2023-2027.
Egypt adopted a new country strategy, through which the International Finance Corporation and the World Bank’s Multilateral Investment Guarantee Agency are affiliated. The strategy is set to catalyze the role of the private sector and the availability of investments, development funds, technical support and consultations that enhance the competitiveness of the private sector in Egypt.
“The strategy will support Egypt’s long-term aims and ambition by setting out the approach to build a thriving low carbon hydrogen sector,” according to the EBRD website.
The country’s strategy comes is in line with the government’s efforts to expand the base of private sector participation in development, and also includes the dimension of regional integration, especially in light of Egypt’s presidency of the COP27 climate conference in 2022.
With the new strategy, Egypt is looking forward to boost its green hydrogen contribution. Accordingly, the country can move forward in its plans to reduce emissions and participate in climate action.
