PROJECT INFORMATION DOCUMENT (PID)
CONCEPT STAGE
Report No.:64945
Project Name
Region
Country
Sector
Lending Instrument
Project ID
{If Add. Fin.} Parent Project ID
Borrower(s)
Implementing Agency
Environmental Screening
Category
Date PID Prepared
Estimated Date of Appraisal
Completion
Estimated Date of Board
Approval
I.
Renewable Energy Carbon Asset Program (RECAP)
MENA
Egypt, Arab Republic of
Energy and Mining
Carbon Finance
P125027
Government of Egypt
Egypt Electricity Transmission Company
[ X]A [ ]B [ ]C [ ]FI [ ]TBD (to be determined)
August 9, 2011
March 15, 2012
June 30, 2012
Introduction and Context
1.
The World Bank and the Government of Egypt (GOE) are in partnership to develop one of the
largest renewable energy development programs in MENA. By 2020 the target is to promote up to 7200
MW of wind power. The program is expected to have a transformational impact on the energy sector in
Egypt.
2.
The GoE is targeting to meet its energy needs with 20% of renewable energy by 2020. As its
hydro potential has largely been exploited, this target is expected to be met through scaling-up of wind
and solar energy. The New and Renewable Energy Authority (NREA) -- one of the agencies under the
Ministry of Electricity and Energy -- and the Egyptian Electricity Transmission Company (EETC) are
executing a number of renewable power generation projects, some of which will be developed by the
private sector under BOO (build, own and operate) mode with all the electricity generated being sold to
EETC. Of this, up to 3000 MW of power is planned to be harnessed from wind resources.
3.
In order to facilitate development of wind power, the World Bank is implementing the Wind
Power Development Project to connect the future wind parks at the Gulf of Suez and Gabel El-Zait to the
national grid by expanding the transmission infrastructure. This will help in the evacuation of over 3000
MW of wind power from the Gulf of Suez and Gabel El Zait to the main load centers; and in reducing
GHG emissions through facilitating the development of a clean energy resource (wind power).
4.
In this proposed carbon finance operation, Bank will support Egypt in the development of carbon
assets linked to renewable energy generation, benefitting from the transmission infrastructure support
provided through the wind power development project. As the risks of infrastructure development for
future renewable energy projects is undertaken by the EETC, all the carbon credits from future projects
are also attributable to the EETC.
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II.
Proposed Development Objective(s)
5.
The objective of this program is to support the development of carbon assets linked to Egypt’s
ample wind resources in the Gulf of Suez and Gabel Et-Zait.
6.
The proposed Program will support the wind power plants delivering energy to the main national
power grid. Each participating CDM project activity (CPA) will represent grid connected wind power
plants with a special focus on evacuating the wind energy to the national power grid.
7.
Each of the wind farms will be constructed under a Build Own Operate (BOO) scheme where the
private sector developers will take on majority of the financing, construction and operational risks of the
wind farms. More specifically, the proposed CDM Program of Activities (PoA) encourages renewable
energy utilization to generate electricity -- which otherwise would have been generated through
alternative fuels (most likely fossil fuels) -- contributing to reduction in specific emissions (emissions of
pollutant per unit of energy generated) including GHG emissions. The expected yearly ER volume for the
first CPA is 437,672 tons of CO2e.
8.
The PoA will be developed in phases with 3-year intervals. The first CPA with 250MW capacity
has been identified and will be located in Ras Gharib in the Gulf of Suez. It will be connected to a 500
KV substation, which in turn is connected to a 500 KV double circuit overhead transmission line which is
expected to evacuate approximately 766,000 MWh from that region.
9. Key outcome indicators include: (i) increased employment opportunities around CPA locations,
which in effect will potentially enhance income of the local communities, (ii) acceleration of
industrialization process through provision of stable power and improved local investment environment,
and (iii) diversified sources of electricity generation, which meet the growing energy demand contributing
to the transition away from crude oil and natural gas, and to poverty alleviation through income and
employment generation.
III.
Preliminary Description
10. The private sector wind power program will be implemented in phases and each phase will comprise
a CDM project activity (CPA). Depending on the success of phase 1 and private sector interest, other
phases / CPAs will be developed. It is estimated conservatively that by 2020 an additional 1000 MW will
be developed in 2 batches; 500 MW each by 2016 and 2017. Further, registration of the POA will
accommodate development of additional projects in Egypt totaling 3000 MW.
11. The First CPA (250 MW) to be commissioned by 2015 will generate over 400,000 CERs annually.
This is followed by the Second CPA (500 MW) to be commissioned by 2016 and the Third CPA (500
MW) commissioned by 2017, each of which is expected to generate more than 800,000 CERs per year.
12. EETC will enter into a contractual agreement with private developers for each individual wind farm
(CPA). The contract scheme for the first 250 MW CPA has been selected as a BOO contract. Other CPAs
may follow the same model or adopt a different approach as appropriate. This will be clarified after the
implementation of the first CPA and based on the detailed feasibility study. In addition, EETC will also
enter into an agreement with each CPA developer to implement the monitoring plan in the registered PoA
and share all the required information for successful validation and verification. The arrangement also
covers the rights over CERs subsequent to the successful implementation and verification of the emission
reductions.
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IV.
Safeguard Policies that might apply
Safeguard Policies Triggered by the Project
Piloting the Use of Borrower Systems to Address Environmental
and Social Issues in the Bank-Supported Projects (OP/BP 4.00)
Environmental Assessment (OP/BP 4.01)
Natural Habitats (OP/BP 4.04)
Pest Management (OP 4.09)
Physical Cultural Resources (OP/BP 4.11)
Involuntary Resettlement (OP/BP 4.12)
Indigenous Peoples ( OP/BP 4.10)
Forests (OP/BP 4.36)
Safety of Dams (OP/BP 4.37)
Projects in Disputed Areas (OP/BP 7.60)*
Projects on International Waterways (OP/BP 7.50)
Yes
No
X
TBD
X
X
X
X
X
X
X
X
X
X
V.
Tentative financing
Source:
Borrower/Recipient
IBRD
IDA
Others (specify) Carbon Finance
($m.)
Total
6.0
6.0
VI.
Contact point
World Bank
Contact:
Chandrasekar Govindarajalu
Title:
Sr. Energy Specialist
Tel:
(202) 458-1211
Email:
Cgovindarajalu@worldbank.org
VII.
For more information contact:
The Info Shop
The World Bank
1818 H Street, NW
Washington, D.C. 20433
Telephone: (202) 458-4500
Fax: (202) 522-1500
Web: http://www.worldbank.org/infoshop
*
By supporting the proposed project, the Bank does not intend to prejudice the final determination of the parties' claims on the
disputed areas
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