Get ready for more green hydrogen news from Egypt during COP
Could Egypt’s green hydrogen MoUs turn to concrete agreements at COP27? Egypt could unveil new framework agreements for green hydrogen projects during COP27 for “at least a couple of the dozen” MoUs already signed with international companies — marking the next stage in getting them off the ground — DW said yesterday, citing experts.
Keep an eye out for Scatec / Fertiglobe / OC + ReNew:
- Norway’s Scatec — which together with Fertiglobe and Orascom Construction is planning a 100 MW green hydrogen plant in Ain Sokhna — is also “rumored to be ready” to sign framework agreements in November, DW says.
- India’s ReNew Power, due to build a USD 8 bn green hydrogen plant in the Suez Canal Economic Zone (SCZone), hopes to execute a framework agreement during COP27, DW quotes CEO Sumant Sinha saying. ReNew expects to complete detailed project studies within 3-6 months, “leading to decisions regarding the investment by mid-2023,” Sinha is quoted by DW as saying.
And expect more in the months following COP: Egypt is also currently negotiating a hydrogen agreement with the EU, with the European Commission expecting “some developments over the autumn,” DW says.
The gov’t is targeting a wider range of countries: We might expect firms from the UAE, KSA, India and Australia to enter the market, DW notes. Egypt might also target investment from EU countries, Japan, China and Russia.
As for export markets, Egypt will likely look first to the EU: “The green ammonia from Egypt is more likely to go to…Europe and the Far East,” DW quotes Rajat Seksaria, CEO of India's ACME Group — which we noted has signed an MoU for a 2.2 mn ton capacity plant — as saying. Green hydrogen serves as feedstock for green ammonia. The EU’s push for more “green steel” to be made using hydrogen could also open up more production prospects for Egypt, DW notes.
But challenges remain: “The main hurdle for hydrogen is not production, but storage and transportation,” the story quotes energy consultant Ali Habib saying. This is challenging because Egypt’s strategy is export-focused. Demand for local green hydrogen application is currently low, DW notes Habib saying. Still-pending regulation would also be essential for local use to take off, we noted recently.
WATCH THIS SPACE- Local industry may be more incentivized to use green hydrogen when the EU implements its plan to tax imports with a high carbon footprint, DW quotes Habib as saying. Egypt could also call for an easing of EU green content certification during COP27 to open up export to Europe, Lekela Power general manager Faisal Eissa previously predicted.