Egypt is setting its sights on an energy transition, with ambitious plans, strategic partnerships and incentives.
On Monday, Egypt greenlit a draft law with tax and non-tax incentives for green hydrogen projects. The draft, crafted by the government and debated in meetings with key energy and economic ministries, sets its sights on several key goals: attracting investments, fostering green energy development, and ultimately establishing Egypt as a global hub for producing green hydrogen and its derivatives.
During the debates, Minister of Parliamentary Affairs Alaa El-Din Fouad said that this draft provides numerous incentives to develop green energy, attract investments, and make Egypt competitive.
While the specifics of these incentives remain unclear, a prior announcement by Finance Minister Mohamed Maait in May hinted at a generous tax break. He indicated a potential tax reduction ranging from 33% to 55% for green hydrogen projects, offering a glimpse into the government’s commitment to lure investors.
The Suez Canal Economic Zone (SCZONE) is poised to become a prime breeding ground for these pioneering projects.
In another significant move in advancing hydrogen energy, Saudi powerhouse ACWA Power will develop a green hydrogen project in Egypt valued at over $4 billion.
The project’s initial phase will focus on producing 600,000 tonnes per year of green ammonia, a clean fuel derived from renewable energy sources. A second phase can skyrocket production to 2 million tonnes per year.
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