Solar Power and Batteries May Enable Egypt to Overcome Frequent Power Outages and Blackouts
Introduction
Electricity blackouts and rolling outages have become all too common across Egypt. But a powerful solution is emerging from one of Egypt’s most abundant natural resources—the sun. With rising natural gas prices and declining local output, Egypt is turning to solar power, coupled with battery storage, as a way to bring energy stability and independence.
The Obelisk Project: Egypt’s First Hybrid Solar-Battery Plant
What is the Obelisk Project?
Egypt has launched its first large-scale hybrid solar and battery power plant, known as Obelisk. This groundbreaking project aims to combine solar energy with cutting-edge battery technology to tackle Egypt’s electricity shortfalls.
Where It’s Located and Why It Matters
The Obelisk plant is under construction in Nagaa Hammadi, a city in southern Egypt situated in the heart of the “magic solar belt”—a region identified as having some of the best solar potential in the world. Its location is not only ideal for maximum sunlight exposure but also crucial for addressing power shortages in Upper Egypt.
Technical Details of the Plant
Capacity and Storage
Obelisk will feature 1.1 gigawatts (GW) of solar energy generation capacity and 200 megawatt-hours (MWh) of battery storage. That’s enough to significantly support the local grid and reduce dependence on gas-fueled power plants, especially during peak demand periods.
Investment and Funding
The total cost of the project is projected at $590 million, with $479.1 million coming from international institutions, making it one of the most ambitious renewable ventures on the continent.
Who is Behind the Project?
Scatec’s Role in Egypt’s Renewable Shift
The plant is being developed by Scatec, a Norwegian renewable energy firm known for investing in emerging markets. Scatec already operates four renewable energy projects in Egypt, making it a seasoned player in the country’s clean energy transformation.
Other Stakeholders and Financial Backers
The European Bank for Reconstruction and Development (EBRD), African Development Bank (AfDB), and British International Investment (BII) are backing the project financially. Their involvement provides not just capital but also confidence in Egypt’s renewable energy prospects.
Egypt’s Renewable Energy Goals
From 13% to 42% by 2030
As of 2023, 13% of Egypt’s electricity came from renewable sources. By 2030, the goal is to push that figure to 42%. Obelisk plays a major part in helping achieve this ambitious leap.
How Obelisk Fits into the National Strategy
Obelisk is more than just a power plant—it’s a symbol of Egypt’s commitment to energy diversification. It represents a shift from overdependence on fossil fuels to sustainable, long-term power solutions.
Decline of Natural Gas and Impact on Power Supply
Egypt’s Dependence on Natural Gas
Currently, 75% of Egypt’s electricity is generated from natural gas. But as domestic production from major fields like Zohr has declined, the country is struggling to meet demand.
Struggles with Zohr Field and Import Costs
Due to reduced output, Egypt recently issued tenders to import 2 million tons of fuel oil, because gas imports have become prohibitively expensive. The economic strain of this dependency is pushing the country toward renewables.
Coping with the Summer Energy Surge
Air Conditioning and Demand Peaks
Egypt’s hot climate, especially in the summer, leads to massive energy spikes due to air conditioning usage. In southern regions, temperatures regularly soar to 42°C (108°F), making power reliability a necessity.
Government Appeals for Conservation
In response to growing demand and insufficient supply, Prime Minister Mostafa Madbouly has asked Egyptians to limit their electricity use to prevent more blackouts. But conservation alone isn’t a long-term fix—renewable energy is.
The Promise of the “Magic Solar Belt”
Solar Potential in Southern Egypt
The “magic solar belt” in southern Egypt offers exceptionally high solar radiation, making it one of the best areas globally for photovoltaic (PV) solar generation. That’s why Obelisk’s location is so strategic.
Egypt’s Global Solar Ranking
According to the Global Solar Atlas, Egypt ranks fourth worldwide in solar PV potential. Yet, solar made up just a small share of its energy mix until recently.
Overcoming the Intermittency Challenge
Role of Battery Storage
Solar energy only works when the sun shines. Battery storage solves this by allowing excess daytime power to be stored and used at night or during cloudy periods. Obelisk’s 200 MWh of storage makes this possible.
Cost Decline and Viability of Hybrid Systems
Battery storage costs have plummeted—down 89% between 2010 and 2023. This massive price drop makes hybrid systems not just technically feasible, but also economically smart.
Economic vs. Environmental Motivations
Energy Crisis as a Catalyst
Though Egypt hosted COP27 and has stated climate goals, experts like Karim Elgendy of the Carboun Institute argue that the real driver behind the shift is economic necessity. Blackouts, import costs, and inflation are pushing policymakers toward practical solutions.
The Real Driver Behind the Transition
Environmental goals matter, but affordability and reliability are Egypt’s top priorities right now. Solar and battery projects meet both needs.
Financing Renewable Energy in Africa
The Investment Gap
Africa is rich in solar potential but poor in infrastructure. In 2024, the continent attracted just 3% of global energy investments—despite having 60% of the best solar-suited land.
Risks and Returns in Developing Nations
High-risk perceptions and currency concerns make it difficult to fund projects. That’s why international support for Obelisk is so critical—it lowers barriers for future investments.
Africa’s Solar Power Momentum
2024 Surge in South Africa and Egypt
In 2024, 75% of new solar installations in Africa happened in South Africa and Egypt, marking a regional shift in energy development.
Projections for 2025 and Beyond
By 2025, 18 African countries are expected to launch solar projects of over 100 MW, compared to just 2 countries in 2024. This growth could help Africa meet its 300 GW solar target by 2030.
The Role of Global Institutions
EBRD, AfDB, and British Support
Without the financial commitment from multilateral banks and institutions, Obelisk likely wouldn’t be possible. Their participation reflects growing international interest in Africa’s energy future.
Why Multilateral Funding Matters
Global banks de-risk these large infrastructure projects, attracting more private investors and accelerating timelines.
Looking Ahead: Timeline for Completion
First Phase in 2026
The first phase of Obelisk—561 MW of solar capacity and full battery installation—is expected to go online in the first half of 2026.
Full Capacity by End of 2026
By the end of 2026, Obelisk will operate at full capacity, providing a model for other nations looking to combine clean energy with reliability.
Conclusion
The Obelisk project is more than a solar plant; it’s a blueprint for the future of energy in Egypt and across Africa. As power demands grow and fossil fuels falter, solar power backed by battery storage offers a stable, scalable, and sustainable solution. Egypt’s investment in renewable energy shows that even nations heavily dependent on natural gas can pivot toward a cleaner, more reliable energy future—one sunny day at a time. And for more info feel free to contact us.
FAQs
Why is Egypt facing power outages?
Egypt relies heavily on natural gas for electricity. With declining production and expensive imports, the country struggles to meet demand, especially in summer.
What is unique about the Obelisk project?
Obelisk is Egypt’s first hybrid solar and battery power plant, combining 1.1 GW of solar capacity with 200 MWh of storage—making it both powerful and reliable.
How does battery storage help solar energy?
Batteries store solar energy generated during the day for use at night or during cloudy weather, addressing solar power’s main limitation—intermittency.
Why are international banks investing in Egypt’s renewables?
Institutions like the EBRD and AfDB see potential in Egypt’s solar capacity and want to support sustainable, long-term energy solutions in emerging markets.
Will this project solve Egypt’s energy crisis?
While Obelisk won’t fix everything overnight, it’s a significant step toward energy stability and a cleaner, more resilient grid.