Egypt has announced a significant increase in its energy development budget, nearly doubling last year’s allocation as it pushes forward with ambitious renewable energy and infrastructure plans. The Ministry of Planning confirmed that EGP 136.3 billion ($2.8 billion) has been earmarked for the electricity and renewable energy sectors in the 2025–26 fiscal year, up from EGP 72.6 billion ($1.49 billion) in the previous year.
This boost highlights Egypt’s determination to secure energy reliability, accelerate its green transition, and position itself as a regional hub for renewable power.
Surge in Renewable Energy Projects
The funding announcement coincides with rapid progress on major renewable initiatives. Norway’s Scatec has finalized financing for a $600 million solar project and a $1 billion wind project, underscoring foreign investors’ confidence in Egypt’s energy sector. Similarly, French utility company Engie has accelerated work on the 650 MW Red Sea Wind Project, which is expected to become a key contributor to the country’s clean energy mix.
In a separate development, Egypt signed a land usufruct agreement for the establishment of Atom Solar Egypt, a $200 million integrated solar industrial complex in the Suez Canal Economic Zone. Spanning 200,000 square meters, the project will be rolled out over three years in three phases by a consortium of partners from Egypt, China, Bahrain, and the UAE. The facility is set to bolster Egypt’s industrial capacity in renewable technology and create jobs in solar manufacturing.
Expanding Regional Cooperation
Egypt is also strengthening its regional partnerships. In collaboration with Syria’s Ministry of Energy, Saudi-based ACWA Power will explore up to 2.5 GW of new solar and wind capacity, supported by energy storage facilities and a technical training center. Such cross-border projects are part of Egypt’s broader strategy to expand its renewable footprint beyond national borders and to position itself as a regional clean energy leader.
Meanwhile, in the UAE, construction on Phase Six of the Mohammed bin Rashid Al Maktoum Solar Park is advancing quickly, with 68.6 percent already complete and 1 GW of capacity connected to the grid. The project, which will eventually total 1.8 GW, incorporates four million solar modules. Egypt views developments like this as a model for scaling up its own large-scale solar projects.
Strategic Targets and Energy Mix
The sharp rise in funding aligns with Egypt’s goal of raising the share of renewables in its energy mix to 20 percent by 2025–26, up from 12 percent in 2023–24. Current plans aim to expand installed solar and wind capacity to 6,470 MW in the near term. To facilitate this, the government has allocated 2,900 square kilometers of land specifically for renewable energy projects.
Public funding will play a major role in this expansion, accounting for approximately 73 percent of the total, with 45 percent of the budget managed by state-owned holding companies and public enterprises. The remaining 27 percent will come from private sector contributions, signaling a clear intent to balance state oversight with private investment.
Infrastructure and Grid Development
Beyond generation, Egypt is investing heavily in grid and infrastructure upgrades. Plans include adding 1,200 MW of new thermal generation capacity, building nine new 500 kV transformer substations, and modernizing existing facilities such as the Mas’aid, Baghdad, and Matariya stations.
The country also aims to expand regional interconnection capacity from 780 MW to 3,900 MW by 2025–26, enhancing cross-border electricity trade with neighboring countries including Jordan, Libya, Sudan, and Saudi Arabia. An undersea cable project with Greece and Cyprus is also in the works, potentially opening Egypt’s grid to European markets.
Efficiency and Access
The development plan targets not just growth, but also efficiency. By June 2026, Egypt aims to achieve 99.8 percent electricity access across its population, while reducing transmission losses from 19.6 percent to 16.5 percent. These efforts are expected to improve reliability and reduce the overall cost of power supply.
Economic Growth and Vision 2030
The electricity and renewable energy sectors are forecast to grow sharply, with output expected to rise from EGP 655.6 billion in 2025–26 to EGP 984.5 billion by 2028–29. This represents an annual growth rate of 15–20 percent, reflecting the central role of energy in Egypt’s broader economic development.
The country has already attracted $4 billion in concessional financing through its NWFE platform over the past two and a half years, supporting the development of 4.2 GW of renewable capacity. This is nearly halfway toward Egypt’s target of 10 GW of renewable energy by 2028.
These initiatives are closely aligned with Egypt Vision 2030, which emphasizes sustainable energy, economic diversification, and regional energy leadership.
Looking Ahead
Egypt’s decision to nearly double its budget for power and renewables underscores its recognition of energy as the backbone of long-term economic growth. With large-scale solar and wind projects underway, regional interconnections expanding, and infrastructure being modernized, the country is laying the groundwork for a more resilient and sustainable energy future.
However, challenges remain. Delivering on these ambitious targets will require effective coordination between government agencies, private investors, and international partners. It will also demand continued focus on financing, workforce development, and technology transfer.
If successful, Egypt could emerge as a regional model for how emerging economies can balance rapid growth with sustainability, while positioning itself as a central player in the global energy transition.
