Green hydrogen incentives get the greenlight: Ministers have approved a package of incentives aimed at stimulating Egypt’s nascent green hydrogen industry and increasing FX inflows, cabinet said following its weekly meeting yesterday. Under the draft decision, companies implementing green hydrogen projects within five years and deriving a certain percentage of their financing from foreign lenders will receive VAT and income tax breaks.

What’s on offer: Companies will receive tax breaks of between 33-55% on income earned from the plants, and will pay no VAT on raw materials, plant and machinery purchased for the projects. The facilities will be exempt from real estate tax, stamp tax, and a number of administrative fees. Companies will also be permitted to import and export without having their names in either of the registers.

To be eligible: Companies will need to have their projects up and running within five years and obtain at least 70% of their financing from foreign lenders. They will also be expected to source at least 20% of their inputs from local suppliers as part of the government’s push to increase localization and reduce reliance on imports.

Desalination projects and power stations are also eligible — if they link up with green hydrogen plants: The incentives also target water desalination projects that allocate a percentage of their production to green hydrogen projects, and green power plants that allocate no less than 95% of their production to green hydrogen.

ALSO GREENLIT BY CABINET-

  • A draft law that seeks to give squatters a six-month period — which may be extended upon cabinet’s approval — to submit requests to the government to legalize their stay.
  • A grant by USAID for advancing climate action, which was inked in an agreement between the government and USAID last September.
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