Egypt’s green hydrogen strategy aims to supply 5-8% of the world’s hydrogen by 2040, potentially boosting its GDP by $10-18 billion.

In pursuit of this goal, at the beginning of 2024, the country introduced a new law that offers a set of tax incentives aimed at promoting green hydrogen production.

The Green Hydrogen Incentives Law includes tax incentives for green hydrogen production projects, such as tax credits ranging from 33% to 55% of the tax payable on revenues generated from the production of green hydrogen. Additionally, a complete exemption from value-added tax (VAT) has been introduced for equipment, vehicles (excluding passenger vehicles), and raw materials utilized in green hydrogen production.

Similarly, the law eliminated the requirement to be registered at the Importers/Exporters register and the obligation to register the import or export of equipment, machinery, raw materials, vehicles, and spare parts necessary for the project.

As part of Egypt’s ongoing renewable energy strategy and the incentives provided by laws spanning from 2020 to 2024, the country projects that over $60 billion will be invested in green hydrogen and ammonia projects in the coming years. These projects aim to produce 56 million tonnes of green hydrogen and ammonia by 2040, as reported by Egypt’s Addustour newspaper.

The report highlighted that contracts signed with seven foreign contractors over the past few months entail investments totaling up to $40 billion over a span of 10 years.