The European Union (EU) and Egypt have announced a financing package worth up to €690m ($799.8m) to upgrade and expand the Egyptian electricity grid, with a focus on accommodating additional renewable energy capacity.
The arrangement brings together a €600m loan from the European Investment Bank’s development arm, EIB Global, and up to €90m in European Commission grants.
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The grid expansion project, led by the state-owned Egyptian Electricity Transmission Company (EETC), will support the integration of up to 22GW of renewable energy into the country’s grid by 2030.
According to project projections, this could provide electricity to approximately ten million households.
The programme aims to align with Egypt’s national energy objectives, which include expanding the country’s renewable energy sources, reinforcing grid infrastructure and consolidating Egypt’s standing as a regional energy centre.
The investment is part of wider cooperation between Egypt and Europe, notably under the EU-Egypt Strategic and Comprehensive Partnership. This includes objectives such as mobilising investment, facilitating renewable energy projects, and transitioning to a more sustainable energy system.
Egypt’s Foreign Affairs, International Cooperation and Egyptian Expatriates Minister Badr Abdelatty said: “This agreement reflects the strength of the partnership between Egypt and the European Union and our shared determination to advance the green transition.
“Together with the EIB and the EU, we are taking an important step to modernise our electricity network, strengthen energy security and create new opportunities for sustainable growth.”
The project is among the first tangible actions under the Trans-Mediterranean Renewable Energy and Clean-Tech Cooperation Initiative (T‑MED), a flagship programme of the Pact for the Mediterranean. The initiative supports renewable energy and clean-tech collaboration between the EU and its southern Mediterranean partners.
Infrastructure works will include the installation of substations and high-capacity transmission lines, designed to connect solar and wind energy generated in the Red Sea and Gulf of Suez regions to the national grid.
The project aims to reduce energy transmission losses, enhance grid reliability, and support economic development, alongside future plans for regional energy cooperation and clean energy trade.
EU financing will cover 44% of overall programme costs, with the remainder to be met from EETC funds.
The EIB-backed stage of construction is scheduled for 2027 to 2030, with the Central Bank of Egypt serving as borrower on behalf of the government, and EETC overseeing implementation.
Mediterranean European Commissioner Dubravka Šuica said: “Under its newly launched flagship initiative, T-MED, today we presented a major EU-supported project to strengthen and expand Egypt’s electricity infrastructure.
“This will reinforce Egypt’s role in the regional energy markets and create major business opportunities for local and European companies.”
In a related move, Egypt has earmarked E£60bn to further strengthen its electricity network. Prime Minister Mostafa Madbouly recently attended a signing ceremony for a financing protocol to support EETC projects, with officials underscoring the goal of increasing renewables’ share to 45% of the nation’s energy mix by 2028.
Minister of Electricity and Renewable Energy Mahmoud Esmat stated that ongoing grid upgrades are necessary to absorb the planned expansion in renewable generation and to ensure reliable power for citizens and future development projects.
