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Frequently Asked Questions about the private to private projects
For Producers
What technologies of renewable energy are allowed for eligible producers?
Allowed technologies are solar or wind or hybrid (solar + wind)
Is it required to build the projects on renewable energy? Why?
Yes.
In line with the state’s directions, which seek to:
• Reducing emissions by reducing the use of fossil fuels in electricity production and achieving one of the goals of Egypt’s 2030 strategy by maximizing the use of renewable energies.
• Lifting the burden on the state to produce electricity through traditional stations and replacing them with renewable
How many projects at the First Phase?
Number of projects in the first phase is 5 projects with a total capacity of 500 MW (maximum capacity of 100 MW per project).
Is a licensed distribution company allowed to apply for registration as an eligible producer?
At the transition phase of the competitive electricity market a distribution company cannot apply for registration as an eligible producer.
Is a non-licensed producer allowed to apply for registration as an eligible producer?
Yes.
A production company that never had a license before can apply for registration as an eligible producer according to the eligibility conditions specified in the circular .
What are the eligibility criteria for eligible consumers?
• The consumption site for which the application is submitted must be new and will be connected to the transmission grid.
•The applicant must not be engaged in electricity distribution activities. • The applicant consumer and any of its subsidiaries must not have any outstanding amounts owed to the Egyptian Electricity Transmission Company or any other parties in the electricity sector, overdue for more than three (3) months.
To clarify and avoid doubt, any payments not made due to a dispute regarding a bill, whether in whole or in part, according to the rules or conditions applied in the power supply agreement, will not be considered in this case as overdue payments for the purposes of this
Are there any incentives provided for investors?
• The state is moving towards encouraging private sector participation and increasing electricity production from renewable energies. There are many incentives provided for electricity production from renewable energies, as well as incentives for projects using these energies to produce green hydrogen. These regulatory frameworks can be used for this purpose, knowing that these regulatory frameworks for bilateral agreements in the private sector aim to create a competitive environment
while adhering to the principle of competitive neutrality.
• Additionally, the New and Renewable Energy Authority, the Egyptian Electricity Holding Company, and its subsidiaries are not entitled to register as qualified producers .
For Consumers
Is an existing consumer allowed to apply for registration as an eligible consumer?
• An existing consumer may not apply for registration as an eligible consumer. However, in case the consumer wishes to build a new site or expand an existing site he may apply for eligibility
What are the eligibility criteria for eligible consumers?
• The consumption site for which the application is submitted must be new and will be connected to the transmission grid.
• The applicant must not be engaged in electricity distribution activities.
• The applicant consumer and any of its subsidiaries must not have any outstanding amounts owed to the Egyptian Electricity Transmission Company or any other parties in the electricity sector, overdue for more than three (3) months. To clarify and avoid doubt, any payments not made due to a dispute regarding a bill, whether in whole or in part, according to the rules or conditions applied in the power supply agreement, will not be considered in this case as overdue payments for the purposes of this regulation
If there is a previous debt for the consumer to the transmission company?
• The consumer must not have any outstanding amounts owed to the Egyptian Electricity Transmission Company or any other parties in the electricity sector, overdue for more than three (3) months. To avoid doubt, any payments not made due to a dispute regarding a bill, whether in whole or in part.
Regulatory framework
Will EgyptERA’s Board of directors approve eligibility applications or will a special committee be established for this purpose?
A specialized committee will be formed to receive and follow up on registration requests for bilateral agreements between the private sector, and it will present them to the board of directors of the entity for approval and ratification.
Will the eligibility be followed by licensing? And in this case, how will the presentation to the board of directors be conducted?
In the event that the producer intends to establish a new production plant, they will first register for eligibility for P2P projects. If they are approved, they will then apply for an electricity production license. If they are unable to complete the construction of the station, the insurance amount paid at the time of qualification will be deducted.
Will the data provided by the producer for qualification be preliminary? As it's possible that it may change. Therefore, it is advisable to specify a margin of deviation?
The current required documents from the qualified producer will be adhered to for the registration of agreements. In case of any modifications or changes, they will be announced in advance.
If the current regulatory framework for the electricity market changes, what will happen to existing agreements?
The agreements remain valid according to the version of the rules adopted by EgyptERA on the date the agreement was concluded
Under the P2P scheme, is it allowed to use the power grid for banking purposes?
The regulations do not allow for the storage of any amount of energy on the grid of the Egyptian Electricity Transmission Company. Energy quantities are settled between the Egyptian Electricity Transmission Company and market participants on an hourly basis.
What is the maximum number of eligible consumers that each eligible producer can contract with?
Eligible producers are allowed to contract with a maximum of three eligible consumers.