Overview

Egypt has positioned renewable energy as a central pillar of its long-term energy transition and energy security strategy. The government’s Integrated Sustainable Energy Strategy targets 42% of electricity generation from renewable sources by 2030, relying primarily on solar, wind and hydropower.

The country benefits from strong natural endowments, including high solar irradiation and favourable wind corridors along the Gulf of Suez, which underpin large-scale projects such as the 1.65 GW Benban Solar Park, one of the world’s largest solar complexes.

Institutionally, the sector is led by the New and Renewable Energy Authority (NREA), which promotes and develops renewable projects and supports private sector participation. Despite growing investment and flagship projects, Egypt’s power mix remains dominated by natural gas.

Egypt solar

Economic Contribution

Renewable energy is expanding but still represents a relatively modest share of Egypt’s electricity system. As of 2024, renewables accounted for around 11% of electricity generation, reflecting progress but also the scale of the transition required.

The broader electricity and renewable energy sector is attracting rising public investment, with planned sector investments of EGP 136.3 billion in FY2025/26, up significantly from previous years. Solar equipment and project development activity is also growing, supported by government incentives and rising domestic demand for power.

Large-scale renewable projects are increasingly structured with independent power producers and foreign investors, reinforcing the sector’s role in attracting FDI and supporting industrial activity.

Outlook

Future priorities for Egypt’s renewable energy sector include expanding solar and wind capacity, reinforcing transmission grids, accelerating green hydrogen projects, improving energy efficiency and deepening digital transformation. The sector presents strong medium-term growth potential, underpinned by ambitious policy targets, including the objective of reaching 42% renewable electricity generation by 2030, which provides a clear long-term demand signal. Egypt’s exceptional solar irradiation and strong wind regimes support competitive generation costs, while a growing pipeline of utility-scale projects, including recent agreements for a 1 GW solar plant and a 900 MW wind project, points to continued investor interest. The country is also seeking to position itself as a regional green hydrogen export hub, with memoranda covering up to USD 40 billion in potential investments. Its strategic geography and planned electricity interconnections with Europe could further enable renewable electricity exports and strengthen Egypt’s role as an energy hub. 

Several constraints continue to affect sector expansion. Renewable energy deployment remains below the trajectory required to meet the 2030 target, while outdated transmission infrastructure limits the integration of variable renewables. High capital costs, macroeconomic pressures and currency risks increase financing needs and project risk. In addition, continued reliance on natural gas reflects structural lock-in within the electricity system, and adjustments to longer-term targets, alongside the ongoing prioritisation of gas, may weigh on investor confidence.