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Monday, 8 Jan 2024

What We’re Tracking Today
Electric Vehicles
Renewables
Earnings Watch
Moves
Also On Our Radar
Around The World
Calendar

Could Egypt’s electricity price hike make renewable energy alternatives more attractive to investors?

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Today at a glance

1

ELECTRIC VEHICLES

Egypt’s GV Investments + Russia’s Concordia partner to establish an EV components factory in Egypt.
2

RENEWABLES

Could Egypt’s electricity price hike make renewable energy alternatives more attractive to investors?
3
UAE’s EV maker NWTN Motors reports first time revenues and big losses in 1H 2023.
4

MOVES

Amna Al Shamsi appointed as UAE’s Climate Change and Environment Minister.
5

WHAT WE’RE TRACKING TODAY

Morocco will use renewable energies in all new desalination plants.
6

ALSO ON OUR RADAR

Kuwait floats tender for 1.1 GW solar project.

Monday, 8 Jan 2024

What We’re Tracking Today
Electric Vehicles
Renewables
Earnings Watch
Moves
Also On Our Radar
Around The World
Calendar
1

WHAT WE’RE TRACKING TODAY

TODAY: A new EV components plant for Egypt + What does Egypt’s electricity price hike mean for renewables?

Good morning, nice people. We’re back from a long weekend and the regional climate sector remains quiet as we start the second week of January. There is one story creating a buzz…

THE BIG CLIMATE STORY OUTSIDE THE REGION- Azerbaijan names ex-oil exec Mukhtar Babayev as COP29 president: The government of Azerbaijan has appointed its Ecology and Natural Resources Minister Muktar Babayev as the president of 2024’s COP29 climate summit in Baku, sparking concerns from climate activists over Babayev’s former ties to the state’s oil company Socar. Prior to his appointment as minister in 2018, Babayev served a 26-year stint at Socar, climbing the ranks to become the company's vice-president for ecology. Azerbaijan also named its Deputy Foreign Minister Yalchin Rafiyev as lead negotiator of this year's climate summit.

The story made headlines in the international press:Reuters | | AP News | The New York Times | The Washington Post | Bloomberg | BBC | The Guardian

HAPPENING TODAY-

#1-The International Conference on Smart Grid and Renewable Energy kicks off today in Doha,Qatar and runs through to Friday, 12 January. The conference will explore smart grid and renewable energy resources and related technologies. Look for discussion of power electronics, controls, manufacturing, communications, and computational intelligence.

#2- The Sustainability Forum Middle East is opening its doors today in Manama, Bahrain and will conclude tomorrow. The two-day event will focus on accelerating decarbonization in the region and finding financial and technical solutions to speed up the green transition. Speakers at the forum include high-level representatives from companies Lucid Motors, Aluminium Bahrain, Red Sea Global, Acwa Power, and Bahrain steel, amongst others.

WATCH THIS SPACE-

#1-We have a confirmed period for Egypt’s carbon market launch: The Egyptian Stock Exchange (EGX) plans to launch several new financial instruments and indices this year, including a carbon certificates market scheduled for inauguration in 1Q 2024, EGX chairman Ahmed El-Sheikh told Asharq Business last week. The carbon certificates market will allow companies to trade their emissions quotas.

We’ve been waiting for this: In preparation for establishing Africa’s first voluntary carbon market, Egypt’s Financial Regulatory Authority issued carbon credit verification and certification standards for voluntary carbon certificates in August. Last month, Egypt said it identified 16 sectors — including renewable energy, waste management, and carbon capture — in which it aims to attract investments in carbon trading.

#2- Morocco will use renewable energies in all new desalination plants in a bid to reduce the environmental and financial costs of desalination, Moroccan Equipment and Water Minister Nizar Baraka said (watch, runtime 0:15). Morocco currently has 15 desalination plants and has a target to produce 1.4 billion cbm of water by 2030for drinking and agricultural purposes.

Morocco is boosting water sustainability efforts: Moroccan state-owned fertilizer and phosphate company OCP Group secured a USD 18.3 mn green concessional loan from the Canada-African Development Bank Climate Fund in November to expand its desalination efforts in Africa. Taqa Morocco also secured MAD 6.6 bn from a number of local banks in September, part of which is earmarked to finance planned desalination projects by 4Q 2023.

#3- Alba prepares for hydrogen-powered production: Aluminium Bahrain (Alba) is installing a new 680.9 MW turbine that will be compatible to run on green hydrogen in the company's fifth power plant, company CEO Ali Al Bakkali told Bahraini news outlet Al Ayam. The turbine — which will be the first of its kind in the world — is manufactured by Mitsubishi Power and will be used in primary aluminum smelters, the report adds. The project is expected to be completed by 4Q of 2024 and will slash 0.5 tons of CO2 emissions per ton of aluminum produced. Alba’s planned 6 MW solar project is also officially under construction, Al Bakkali added.

Not the first Alba-Mitsubishi cooperation: Alba is working with Mitsubishi to capture CO2 from its aluminum smelter and flue gas plants. If the two projects move forward, they could together help capture 500k to 1 mn metric tons per year by 2030.

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CIRCLE YOUR CALENDAR-

Saudi Arabia will host the Future Minerals Forum from Tuesday, 9 January through to Thursday, 11 January in Riyadh. The event will focus on resource-rich regions of Africa, Western Asia, and Central Asia and will include a ministerial roundtable with over 60 countries being represented. A parallel exhibition will have some 150 exhibitors and industry sponsors on site.

Libya will host the Libya Energy and Economic Summit on Saturday, 13 January to Sunday, 14 January in Tripoli. The forum will bring together key stakeholders in the energy sector, including government officials, industry leaders, investors, and experts to discuss opportunities in Libya’s energy industry, including in renewables.

The UAE will host the Management and Sustainability of Water Resources Conference from Monday, 26 February to Wednesday 28 February in Dubai. Water availability in arid and semiarid regions, global water issues, and future water and environmental challenges are all on the agenda.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

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2

ELECTRIC VEHICLES

Egypt’s GV Investments + Russia’s Concordia partner to establish an EV components factory in Egypt

Egyptian industrial developer GV Investmentshas partnered with Russian EV manufacturer Concordia to establish an EV components manufacturing plant in Egypt, Arab Finance reports, citing an emailed press release. It is unclear from the statement which components will be manufactured. Operations are expected to start in 2Q 2024, and the products will be exported across the Gulf and North Africa

The details: GV Investments will be responsible for providing the land as well as constructing the factory, which is set to have a production capacity of 5k units of the EV components. The company will implement a 60% local component quota in the manufacturing process of the units.

Not GV’s first green project: Qatar’s Gulf Organisation for Research & Development and GV Investments signed an MoU last April to implement Global Sustainability Assessment System standards for Tarboul Industrial City — the largest Egyptian industrial city covering an area of 109 mn sqm. The developer has also set aside an area of 500k sqm to build ready-made industrial complexes for medium and small-sized projects in the city.

About Concordia:Concordia is a Russian electric car manufacturer specializing in producing EVs for off-road use, passenger transportation, and various cargo needs, the company states on its website.Concordia serves as the exclusive distributor of the LvTong New Energy plant in the Eurasian Economic Union.

IN OTHER REGIONAL EV NEWS- Morocco to become a regional battery hub: Morocco has so far shored up USD 700 mn in EV battery cathode investments from Chinese companies, USD 490 mn of which came from Chinese EV supplier BTR New Material’s lithium battery cathode project announced last month, Morocco World News reports, citing a report by Benchmark Minerals Intelligence. The investments made so far are enough to meet a quarter of Europe's projected demands.

More on BTR’s project: The lithium battery cathode project — to be carried out in phases — will have a production capacity of 50k tons annually, and will be located in Tangier Technopark City within Morocco’s Tangier Province. Initially, BTR had announced in April plans to invest USD 1.2 bn to establish the new facility, with the production earmarked for the US given BTR’s contract to supply components for Tesla. The timeline of the project was not disclosed.

And more: Chinese battery minerals producer Zhejiang Huayou Cobalt was exploring a USD 20 bn electric vehicle battery plant in Morocco in August. China's battery giant CNGR Advanced Material Company teamed up with Morocco-based pan-African investment fund Al Mada in September to build a USD 2 bn industrial base for battery parts production and recycling in Morocco. Global tech giant ABB Group also signed an MoU last month with Chinese EV battery manufacturer Gotion High-Tech to help build its EV batteries gigafactory currently under study in Morocco.

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3

RENEWABLES

Could Egypt’s electricity price hike make renewable energy alternatives more attractive to investors?

Egypt hikes electricity prices leveling the playing field for renewables: Egypt’s Electricity and Renewable Energy Ministry has approved a 16-26% (consumption-dependent) increase in electricity tariffs for households and businesses, bringing the price of fossil-fuel powered electricity closer to that of renewable energy. This improves the latter’s level of competitiveness in the market, and could attract more investments into Egypt’s renewables sector. The new price ranges came into effect at the start of the month and will be in place until June 2024, according to an Electricity Ministry official that spoke to Enterprise.

Breakdown of electricity increase for households based on consumption:

  • The first 0-50 KWh/month will be charged EGP 0.58, up 20.8% from EGP 0.48;
  • The next 51-100 KWh/month at EGP 0.68, up 17.2% from EGP 0.58;
  • The next 101-200 KWh/month at EGP 0.83, up 7.8% from EGP 0.77;
  • The next 201-350 KWh/month at EGP 1.25, up 17.9% from EGP 1.06;
  • The next 351-650 KWh/month at EGP 1.4, up 9.4% from EGP 1.28;
  • Those consuming more that 1,000 KWh per month will pay EGP 1.65, up 13.8% from EGP 1.45.

Breakdown of electricity increase for businesses based on consumption:

  • The first 0-100 kWh/month will rise to EGP 0.65 per kW.
  • The next 0-250 kWh/month will rise by 13% to EGP 0.136 per kW
  • The next 0-600 kWh/month will see a 7% hike in power bills to EGP 0.15 per kW
  • The next 601 kWh-1 MW/month will rise 6% to EGP 0.165 per kW,
  • > 1 MWh/month can expect a 12% jump to EGP 0.18 per kW.

Electricity subsidies are on the way out: The Madbouly government in 2020 laid out a roadmap to phase out subsidies by 2025 — pushing back an existing July 2022 deadline that was already an extension of a 2019 deadline penciled in way back in 2014.

And the subject has been a point of contention: The final text of the COP28 climate summit last month called for the phase out of “inefficient fossil fuel subsidies that do not address energy poverty or just transitions, as soon as possible” in order for the price of energy sourced from fossil fuels to adjust to a more accurate market price which places renewable energy on a more equal standing. Developing countries currently facing dangerous levels of inflation however have been reluctant to remove subsidies fearing the impact on its citizens, especially as green alternatives are yet to become easily accessible.

In the meantime, Egypt has been slowly rolling out green incentives: The state-owned Egyptian Electricity Holding Company last month issued regulations on decentralized solar energy usage in a bid to accelerate the switch to green energy. The Egyptian government says it has identified seven major strategic industries including the solar energy, green hydrogen and EV sectors as potential beneficiaries of the state’s planned tax exemptions announced in late August. The planned incentives include five-year tax breaks except for VAT, discounts on land prices, and an expansion of Egypt’s single-approval golden license in a bid to accelerate projects in priority sectors.

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4

EARNINGS WATCH

UAE’s EV maker NWTN Motors reports first time revenues and big losses in 1H 2023

UAE’s NWTN accrues more net losses but cinches revenues: UAE-based, Nasdaq-listed, green mobility company NWTN Motors reported USD 69.75 mn in net losses for 1H 2023, a 655% y-o-y increase from the USD 9.23 mn it reported in for the six month period ending on June 30, 2022, according to a company disclosure published on Thursday. The EV maker — which reported zero revenues in 1H 2022 — also recorded USD 583k in net revenues for the six months ending on June 30, 2023. The newly booked revenues come on the back of the first delivery of its locally manufactured EVs to a single client.

The UAE firm has ramped up its inventories in preparation for more sales: The company’s inventories totalled USD 51.7 mn at June 30, 2023, compared to USD 2.1 mn at December 31, 2022, the statement notes.

NWTN made headway in EV manufacturing: NWTN obtained production and sales licenses including the Gulf Standardization Organization, the Production License of Ministry of Industry and Advanced Technology, and the Made in the Emirates certifications by 2H 2023, the statement notes. The company’s EV assembly and manufacturing plant in Khalifa Economic Zones Abu Dhabi (Kezad) also achieved the ISO 14001 (environmental management system) certification.

And completed its supply chain plant in China: NWTN says its parts and supply chain facility in Zhejiang, China was “essentially done” by the end of 2023, with factory staff already recruited and undergoing training in a bid to kickoff full fledged operations.

ALSO- The car maker pulled out of its acquisition of a Chinese EV manufacturer: On December 31, NWTN officially delivered notice to EV manufacturer China Evergrande New Energy Vehicle Group (CENEV) that it is terminating the Share Subscription Agreement to buy a 27.5% stake in CENEV due to “the conditions to closing not been satisfied or waived,” the company said in the disclosure. The equity investment would have cost NWTN USD 500 mn.

REMEMBER- NWTN has already unveiled its first EV: NWTN unveiled the UAE’s first EV — the Rabdan One — in October and signed an MoU with Al Khalid Auto in April for the delivery of over 1k vehicles over the next two years, kicking off the development of its sales and distribution network in GCC countries.

While building up its manufacturing capacity in the nascent EV market:The company signed an MoU with the Abu Dhabi Department of Economic Development (DED) to establish a new integrated electric vehicle production line in the UAE and further expand its EV factory in Abu Dhabi last July. This move builds on a previously signed lease agreement with Kezad for its EV assembly plant in September2022, targeting an initial phase of operations with an annual capacity of between 5-10k vehicles of semi-knocked-down EVs. In its second phase, NWTN planned to introduce several new EV models and expand the 25k sqm facility’s capacity to 50k units per year.

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5

MOVES

Amna Al Shamsi appointed as UAE’s Climate Change and Environment Minister

The UAE has a new Climate Change and Environment Minister: Amna Al Shamsi (LinkedIn) has been tapped to serve as the UAE’s new Climate Change and Environment Minister succeeding Mariam Almheiri who will move to lead the Office of International Affairs in the Emirates’ Presidential Office, the UAE’s Prime Minister Mohammed bin Rashid Al Maktoum said on Saturday. Prior to her appointment, Al Shamsi served as the UAE Education Ministry’s Assistant Undersecretary and before that was the ministry’s Director of Innovation and Entrepreneurship.The new minister will expand the country’s focus on developing its agricultural sector and consolidating food security.

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6

ALSO ON OUR RADAR

Kuwait invites bids for 1.1 GW solar farm

SOLAR-

Kuwait floats tender for 1.1 GW solar project: The Kuwait Authority for Partnership Projects (KAPP) has invited global and local developers to bid on the 1.1 GW third phase of the Al Dibdibah Power and Al Shagaya Renewable Energy solar project, TradeArabia reports. The winning bid will be tasked with financing, design, procurement, engineering, construction, testing, commissioning, operation and maintenance of the project. The country’s Electricity, Water, and Renewable Energy Ministry will ink a 30-year PPA to be the sole offtaker for the energy produced.The deadline for bid submissions is 22 February.

Advisors: Ernst & Young are acting as KAPP’s lead and financial advisor on the solar tender. DLA Piper serves as the government authority’s legal advisor and DNV is acting as the technical and environmental advisor for the project.

CRITICAL MINERALS-

Oman has abundant minerals for green energy: Oman has a rich geological structure of natural resources that can support the global energy transition, the Oman Observer reported last week, citing statements by Oman’s Energy and Minerals Ministry. The geological deposits include platinum, lithium, copper, silicon, and cobalt — essential for the production of solar panels, wind turbines, electric vehicles, and other clean energy technologies. The sustainable commercialisation of these ores can help unlock access to these resources, Ministry Under-Secretary Mohsin al Hadhrami said.

Oman is capitalizing on its minerals: The Oman Investment Authority and the Energy & Minerals Group’s lithium refining subsidiary LiChem signed an agreement last month to explore the development of a lithium refining complex in Oman.

OTHER STORIES WORTH KNOWING ABOUT THIS MORNING-

  • UAE University goes green with 20 new research projects: The UAE University launched the Green Research Projects initiative on Friday to fund and support 20 research projects related to sustainability and climate change. The projects will launch this month and cover areas including renewable energy technologies, natural resource management, and sustainable agriculture. (Wam)
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7

AROUND THE WORLD

UK to boost nuclear fuel production with GBP 300 mn

UK to invest GBP 300 mn in nuclear energy: The UK government will invest GBP 300 mn in a new program to produce high-assay low-enriched uranium (HALEU) for power generation in the next generation of nuclear reactors, Reuters reports. The program aims to support domestic production of HALEU and reduce the country's energy reliance on Russia, which is currently the only country producing the fuel on a commercial scale. The UK’s first production plant is expected to be operational by the early 2030s. The investment is also part of Britain's commitment to triple global nuclear capacity by 2050.

OTHER STORIES WORTH KNOWING ABOUT THIS MORNING-

  • US approves loan to detect methane leaks: The US government approved a USD 189 mn loan to LongPath Technologies — a company that uses lasers to detect methane leaks from oil and gas sites — on Friday. The loan will help LongPath expand its network of methane monitors across the Permian Basin and six other states. (Bloomberg)
  • Tesla recalls 1.6 mn EVs in China: Tesla issued a recall of 1.6 mn vehicles — Model S, X, 3, and Y cars — in China over the weekend due to issues withautomatic driver-assistance steering and door latch controls. The vehicles will be fixed remotely using over-the-air software updates. (Reuters)
  • Vinfast to open its first EV battery plant in India: Vietnamese EV maker VinFast is set to open a battery manufacturing facility in Tamil Nadu, India, which is already home to big names in the EV industry including India’s Ola Electric and Ather as well as China's BYD. No details on the investment size or expected date for operations have been revealed. (Reuters)
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CALENDAR

JANUARY 2024

8-10 January (Monday-Wednesday): International Conference on Smart Grid and Renewable Energy, Doha, Qatar.

8-9 January (Monday-Tuesday): Sustainability Forum Middle East, Manama, Bahrain.

9-11 January (Tuesday-Thursday): Future Minerals Forum, Riyadh, Saudi Arabia.

13-14 January (Saturday-Sunday): Libya Energy and Economic Summit, Tripoli, Libya.

20-24 January (Saturday-Wednesday): ASHRAE Winter Conference, Illinois, USA.

FEBRUARY 2024

26-28 February (Monday-Wednesday): Management and Sustainability of Water Resources, Dubai, UAE.

MARCH 2024

4-6 March (Monday-Wednesday): International Conference on Sand and Dust Storms in the Arabian Peninsula, Riyadh, Saudi Arabia.

APRIL 2024

16-18 April (Tuesday-Thursday): World Future Energy Summit, Abu Dhabi, UAE.

16-18 April (Tuesday-Thursday): Middle East Energy, Dubai, UAE.

23-25 April (Tuesday-Thursday): Connecting Green Hydrogen MENA, Dubai, UAE.

30 April-2 May (Tuesday-Thursday): Autonomous E-Mobility Forum, Doha, Qatar.

MAY 2024

7-9 May (Tuesday-Thursday): Global Waste Forum, Algiers, Algeria.

19-21 May (Sunday-Tuesday): Saudi Energy Convention, Riyadh, KSA.

JUNE 2024

5 June (Wednesday): World Environment Day, Saudi Arabia.

OCTOBER 2024

15-17 October (Tuesday-Thursday): EV Auto Show, Riyadh, KSA.

DECEMBER 2024

2-13 December (Monday-Friday): Conference of the Parties (COP16) to the United Nation Convention to Combat Desertification, Riyadh, KSA.

EVENTS WITH NO SET DATE

2024

Early 2024: The 2023 US Algeria Energy Forum, Washington DC, USA.

12-14 February (Monday-Wednesday): Sustainable Aviation Futures MENA Congress, Dubai, UAE.

End-2024: Emirati Masdar’s 500 MW wind farm in Uzbekistan to begin commercial operations.

QatarEnergy’s industrial cities solar power project will start electricity production.

2025

International Union for Conservation of Nature World Conservation Congress, Abu Dhabi, UAE.

UAE to have over 1k EV charging stations installed.

2026

26-29 October (Monday-Thursday): World Energy Congress, Riyadh, Saudi Arabia.

UITP Global Public Transport Summit, Dubai, UAE.

Annual Meetings of the World Bank and the International Monetary Fund, Bangkok, Thailand.

1Q 2026: QatarEnergy’s USD 1 bn blue ammonia plant to be completed.

End-2026: HSBC Bahrain to eliminate single-use PVC plastic cards.

2027

MENA’s district cooling market is expected to reach USD 15 bn.

2030

UAE’s Abu Dhabi Commercial Bank (ADCB) wants to provide AED 35 bn in green financing.

UAE targets 14 GW in clean energy capacity.

Tunisia targets 30% of renewables in its energy mix.

Qatar wants to generate USD 17 bn from its circular economy, creating 9k-19k jobs.

Morocco’s Xlinks solar and wind energy project to generate 10.5 GW of energy.

2035

Qatar to capture up to 11 mn tons of CO2 annually.

2045

Qatar’s Public Works Authority’s (Ashghal) USD 1.5 bn sewage treatment facility to reach 600k cm/d capacity.

2050

Tunisia’s carbon neutrality target.

2060

Nigeria aims to achieve its net-zero emissions target.

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