Pulse check on the NWFE initiative: The Planning and International Cooperation Ministry released its second progress report (pdf) on the government’s Nexus for Food, Water, and Energy initiative (NWFE), giving us a look at what the initiative has so far achieved and what it plans to achieve in the short and long term.

REFRESHER- The NWFE program — launched in 2022 — is the government’s flagship initiative aiming to raise blended finance for nine climate adaptation and renewables projects. The program aims to reduce Egypt’s emissions levels, improve air quality, and ensure access to reliable and clean energy sources, all in line with the country’s nationally determined contributions (NDCs).

The initiative has received a lot of backing from the international community, with lead partners including the European Bank for Reconstruction and Development (EBRD), the International Fund for Agricultural Development (IFAD), the African Development Bank (AfDB), and the European Investment Bank (EIB). It is also backed by the EU, the United Nations, the International Finance Corporation, and HSBC, to name a few.

Part of a wider plan: The initiative aims to feed into the country’s National Climate Change

Strategy for 2050, which was unveiled a couple of months before NWFE in August of 2022. EnterpriseAM spoke to Amr Abdel Aziz, chairman of the environmental consulting firm that helped craft the strategy, to learn more about it. Check out the full interview here.

So, what has the energy pillar achieved so far? Since the initiative’s launch, seven renewables projects have secured financial closure, with a combined investment cost of USD 4 bn. In addition, the Egyptian Electricity Transmission Company (EETC) inked long-term power purchase agreements for renewable energy with a long list of private players — including Acwa Power, Masdar, and Scatec — for a combined 4.2 GW capacity. The renewables projects have a combined investment cost of USD 3.9 bn.

And more to come: Several solar and wind energy projects with a combined capacity of 3.4 GW are expected to reach financial close this year — including Scatec’s 1.1 GW solar plant in Naga Hammadi, which will power EgyptAlum’s complex, AMEA’s Amunet wind project, and the first phase of Scatec’s USD 5.7 bn 5 GW wind farm in West Sohag.

Other efforts in the energy pillar worth noting: The state has decommissioned 1.2 GW of thermal stations that run on traditional energy sources since the initiative kicked off — the plan is to decommission stations producing a total of 5 GW.

We can’t talk about going green without mentioning green hydrogen: The report highlights efforts made in green hydrogen production, explaining that while efforts are yet to yield tangible results, “the country has seen notable improvements in international rankings, particularly among Arab and African nations.”

ICYMI- Egypt ranked 22nd on the Climate Change Performance Index (CCPI) in 2024, scoring 61.8 points and an overall “medium” rating, surpassed in the Mena region only by Morocco.

REMEMBER- The government in August launched the National Low-Carbon HydrogenStrategy, which targets 5-8% of the global hydrogen market by 2040. The strategy outlines two scenarios — a “central” scenario which sees the country producing 1.5 mn tons per annum of green hydrogen by 2030, with 1.4 mn tons pegged for export, and a more ambitious “green” scenario that sees the country producing 3.2 mn metric tons of green hydrogen annually by 2030, with 2.8 mn metric tons earmarked for export.

What’s next for the pillar? “Work will continue with development partners, building on the progress made over the past two years. The focus will be on leveraging innovative financing mechanisms, including debt swaps, utilizing available grants, and increasing private sector participation,” the report reads.

As for the food pillar, it includes projects such as the World Bank-backed climate-resilient agri-food transformation, which focuses on developing modern irrigation systems in the Delta and setting up an early warning system across the country. It also includes adaptation of the Northern Delta affected by sea level rise, which is being carried out alongside the EU and the EIB. The EU provided us with a EUR 125k grant, and the EIB allocated another EUR 300k for consultancy services for the project.

What about the water pillar? Egypt secured over EUR 500k from the AfDB’s African Water Facility, which will “fund the preparation of essential upstream technical studies for the development of five renewable energy-powered water desalination plants.” The plants will be built through public-private partnerships and aim to increase water supply by 525k cubic meters per day across Port Said, Alexandria, Matrouh, and the Red Sea.

Then there’s sustainable transport, under which a handful of projects fall, including the extensions of Cairo Metro 1, the Abu Qir Railway Line, and the construction of a couple of other railway lines. The EIB, EBRD, and French Development Agency (AFD) committed a combined EUR 3.5 bn in concessional loans to support the sustainable transport sector. “The EIB has played a central role not only in providing funding, but also in coordinating with other international partners to provide technical assistance grants. These grants are intended to fund the necessary studies for the implementation of sustainable transport projects,” the report reads.

Going electric: The Transport Ministry is prioritizing environmentally friendly public transport by introducing electric buses and trains, as well as green metro systems to reduce carbon emissions.

Looking ahead: The government plans to focus this year on completing the needed studies for upcoming sustainable transport projects. “This includes identifying additional funding sources to secure more grants for the preparation of technical, environmental, and social studies, which are necessary for the smooth execution of these projects.”

Expanding NWFE: Egypt is working with the African Development Bank to roll out a regional initiative “that seeks to leverage what has been achieved in the framework of the Country Platform for the NWFE program.” The first phase will see the initiative expand into Kenya, Senegal, and Zambia, with plans to eventually cover the entire continent.

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