Egyptalum moves closer to its decarbonisation goal with Scatec: Signs 25 years PPA

Scatec, a leading renewables company, has entered into a 25-year corporate Power Purchase Agreement (PPA) with Egyptalum. Under this agreement, the Norwegian renewable energy company will develop a 1,100 MW solar power plant and a 100 MW / 200 MWh battery energy storage system (BESS). The total estimated capital expenditure for the project in Egypt is approximately $650 million.

As the country’s largest aluminium producer and its most significant industrial electricity consumer, Egyptalum exports around 60 per cent of its production to Europe. The solar PV and BESS project will play a crucial role in the company’s efforts to decarbonise its operations and align with the EU’s Carbon Border Adjustment Mechanism (CBAM) regulations set to take effect in 2026.

Scatec chief executive Terj Pilskog said, “This is another testament to Scatec’s position as one of the leading renewables companies in Egypt. It is a groundbreaking project as it is the first utility-scale PPA in the country with an industrial offtake. I would like to thank all parties involved for making this happen, especially our partners at Egypt Aluminium. Further, our team has shown great persistence and creativity in securing this agreement and bringing new solutions to the market.”

The project's next phase involves collaborating with the relevant authorities to secure land allocation, finalise grid connection, and arrange financing. Construction is expected to commence within the next 12 months.

The estimated $650 million capital investment will be financed through approximately 80 per cent non-recourse project debt, with the remaining portion covered by equity contributions from Scatec and its partners. While Scatec currently holds full ownership of the project, it plans to reduce its long-term economic stake by bringing in additional equity partners. Scatec will serve as the EPC service provider, overseeing around 90 per cent of the total capital expenditure, and will also act as the asset manager and operations and maintenance (O&M) service provider.