Cairo, Egypt — Amid the rapid transformations taking place in the global energy sector, solar energy is gaining increasing importance as a strategic pathway to bolster energy security, reduce reliance on conventional fuels, and enhance the competitiveness of national economies. Egypt possesses the natural and geographical assets to become a promising regional hub for clean energy production; however, translating this potential into sustainable economic returns remains contingent upon developing the electrical grid, expanding storage capacities, attracting investments, and deepening local manufacturing.
In an interview with “Voice of Emirates” Dr. Iman Mohamed Mustafa—an expert in energy technology development, nanotechnology, and innovation in petroleum processes—explores several key issues regarding the future of solar energy in Egypt. Her insights cover a wide range of topics: from assessing production capacities, economic feasibility, and natural gas savings, to the challenges of integrating renewable electricity into the national grid. She also discusses the role of nanotechnology in enhancing the efficiency of solar panels, as well as the potential for building a competitive, export-oriented national industry. Dr. Mustafa emphasizes that the primary challenge is no longer just the construction of new power plants; Rather, it now concerns the national grid’s capacity to accommodate increased energy production, the development of effective storage solutions, and the transformation of renewable energy projects into a fully integrated economic and industrial ecosystem.
How do you assess the current state of the solar energy sector in Egypt? And to what extent do the announced capacities reflect the actual volume of solar electricity being produced and fed into the grid?
The solar energy sector in Egypt is experiencing a clear structural boom, driven by the massive Benban Solar Park in Aswan, alongside projects by the New and Renewable Energy Authority and investments from the private sector. However, it is essential to make a technical distinction between nominal installed capacity and actual electricity generation. The figures announced for capacity reflect the maximum potential output of the plants under standard conditions, whereas actual production is determined by factors such as hours of sunlight, operational efficiency, and climatic conditions.
In Egypt, the capacity factor for solar energy ranges between 22% and 27%, thanks to high levels of solar irradiation. This means that a 100-megawatt power plant can generate between 190 and 230 million kilowatt-hours annually. The electricity produced is fed into and managed through the transmission grid; however, the real challenge lies in aligning daytime generation with peak evening consumption, making energy storage and grid development essential components for the next phase.
What are the key factors determining the pace of expansion for solar energy projects in Egypt: construction costs, grid readiness, availability of financing, or the capacity for electricity storage?
These factors can be ranked by their current level of urgency: at the forefront is grid readiness—the capacity of the network to accommodate new power sources—followed by financing challenges amid fluctuations in interest and exchange rates, and then the growing need for electricity storage solutions. Construction costs, meanwhile, are no longer the primary obstacle they once were, particularly given the ongoing global decline in the price of solar panels. Consequently, accelerating expansion requires a comprehensive vision that goes beyond merely building new power plants; it must also ensure that the grid is capable of receiving and efficiently managing the energy they produce.
What is the true competitive advantage that Egypt possesses in the field of solar energy compared to other countries in the region? And how can the abundance of solar radiation be transformed into a tangible economic advantage?
Egypt is situated in the heart of the global “solar belt,” benefiting from direct solar irradiation levels exceeding 2,200 to 2,600 kWh/m² annually—a significant natural advantage. However, translating this advantage into economic value requires action along three primary paths: first, expanding the production of green hydrogen and green ammonia to meet the demands of regional and global markets. Second, integrating solar power plants with water desalination projects, which bolsters water security while reducing operational costs. Third, linking clean electricity to the national industrial sector, thereby lowering the carbon footprint of Egyptian products and enhancing their competitiveness in foreign markets—an increasingly critical factor given the implementation of the European Union’s Carbon Border Adjustment Mechanism (CBAM).
To what extent can solar energy reduce the consumption of natural gas used for electricity generation? And how can the actual savings in fuel and foreign currency be measured?
There is a direct relationship between the expansion of solar energy and the conservation of natural gas; as the contribution of solar-generated electricity to the energy mix increases, the need to operate certain conventional gas-fired power plants decreases. When operating efficiently, every 1,000 megawatts of solar capacity can save approximately 350 to 400 million cubic meters of natural gas annually. The actual savings are determined by comparing the fuel consumption rates of thermal power plants against the electricity effectively generated from solar sources, and subsequently calculating the value of the saved gas based on its global market price or the opportunity cost of exporting it.
To illustrate, a 1,000-megawatt solar power plant can generate approximately 2.19 billion kilowatt-hours annually, saving nearly 375 million cubic meters of natural gas. Assuming an average export price of $11 per million British thermal units (Btu), the savings could exceed $140 million per year—a figure that underscores the economic and strategic importance of expanding solar energy capacity.
With rising financing costs and exchange rate fluctuations, do solar energy projects in Egypt remain economically viable?
Yes, it remains highly economically viable. While capital costs have been affected by rising financing costs and exchange rate fluctuations, the opportunity cost of relying on conventional fuels has simultaneously increased. Viability should be assessed using the Levelized Cost of Energy (LCOE), which accounts for the long operational lifespan of solar panels—exceeding 25 years—as well as lower operation and maintenance costs compared to traditional power generation plants. This provides solar projects with a significant long-term advantage, particularly when conducting rigorous financial analyses that factor in financing costs, production output, project lifespan, and maintenance requirements.
For factories and commercial facilities, at what point does installing a solar power system become a more economical choice than relying entirely on the grid?
Investing in solar energy becomes increasingly attractive when industrial activity is concentrated during daylight hours—allowing for the direct consumption of the electricity generated—and when a facility falls into a high-tier electricity consumption bracket. Furthermore, the viability of such an investment grows as companies seek to reduce their carbon footprint and comply with the environmental requirements of external markets. Before making a decision, it is essential to evaluate the available roof space, potential shading, the structural integrity of the facility, the initial investment costs, the payback period, and the regulatory framework governing grid interconnection.
Consider the case of a medium-sized factory that installed a 100 kW rooftop solar power system. With an investment cost of approximately 1.9 million EGP, the system generates about 170,000 kWh annually. According to the projections for this model, the factory achieves savings of over 540,000 EGP per year on its electricity bill. This allows for the recovery of the initial capital investment within approximately 3.5 to 4 years, while the factory continues to benefit from the electricity generated throughout the system’s operational lifespan.
Could the benefits of solar energy extend to the petroleum, petrochemical, and water desalination industries?
Certainly. It is important not to limit the use of solar energy solely to electricity generation; solar thermal energy and concentrated solar power (CSP) technologies represent a strategic opportunity for heavy industry. In the petroleum refining and petrochemical sectors, industrial processes rely on boilers to produce thermal steam—which, in certain applications, reaches temperatures between 150°C and 400°C. Concentrated solar collectors can be integrated into these systems to offset 30% to 50% of the gas and fuel oil consumption during daylight hours, wherever the application is suitable.
In water desalination, energy accounts for approximately 40% to 50% of operating costs; therefore, integrating thermal technologies can help reduce the cost of producing desalinated water. Notable international examples include the Amal project in the Sultanate of Oman, which utilizes solar-generated steam for heavy oil extraction, and the Al-Khafji desalination project in Saudi Arabia.
Solar power plants generate electricity during the day, while consumption often peaks at times when solar generation may not be available. How can this gap be addressed in practical terms in Egypt?
Addressing this gap requires a combination of integrated solutions. First are pumped-storage projects, such as the Gabal El-Attaka project; second are Battery Energy Storage Systems (BESS), which allow electricity to be stored during daylight hours and discharged in the evening. Furthermore, there is the role of smart industrial load management—shifting energy-intensive operations to times when solar power is abundant—alongside the strengthening of regional electrical interconnections to facilitate the exchange of surplus energy. No single solution is sufficient on its own; rather, an integrated ecosystem is needed to ensure the maximum utilization of clean electricity.
Do electricity storage batteries represent the most viable solution for expanding solar energy, or are there less costly alternatives?
Batteries are extremely important—especially given the global decline in the costs of storage technologies, such as lithium or sodium-based batteries—but they are not the only solution. In the near term, grid development and load management offer the most cost-effective and immediate ways to improve the efficiency of renewable energy use. As for batteries, their importance grows progressively as the share of renewable energy in the electricity mix increases, making the need to store and reuse surplus energy ever more pressing.
What are the key technical challenges that the Egyptian grid might face as the contribution of solar energy increases?
The greatest challenge lies in maintaining the stability of electrical frequency and voltage in the face of sudden fluctuations in power generation—such as those caused by passing clouds or a drop in solar irradiance. There is also the “duck curve” phenomenon, which reflects shifts in electricity demand patterns resulting from the increased contribution of solar energy during daylight hours. To address these challenges, urgent investment is required in smart grids, advanced control centers, and reactive power compensation equipment. Such measures are essential to ensure grid stability and the capacity to integrate new energy sources without compromising the quality of the electricity supply.
How viable is it to install solar energy systems on rooftops in Egypt? And what is the approximate payback period for the investment?
The economic viability is high, particularly for properties with high energy consumption—such as villas and detached houses—as well as for commercial and industrial facilities. In Egypt, the payback period for such investments currently ranges from approximately 4 to 6 years, depending on three key factors. The first is the consumption bracket and the size of the electricity bill; higher consumption translates into greater potential financial savings. The second factor is the quality of the solar panels and inverters used, as higher-efficiency components offer better output and a longer operational lifespan. The third factor is the grid-connection framework and the electricity tariff structure; specifically, the “net metering” system helps reduce the need for costly battery storage. Given that solar energy systems have an expected lifespan exceeding 25 years, consumers can recover their initial investment within the first few years and continue to benefit from electricity generation for many years thereafter.
What are the most common mistakes that a homeowner or investor might make when purchasing and installing a solar energy system? And how can one verify the quality of the components?
One of the most significant mistakes is prioritizing lower initial costs at the expense of quality—whether in the selection of contractors, solar panels, or inverters. Engineering errors, such as poor system design, incorrect panel orientation, or failing to account for shading, can lead to a substantial decline in energy production. Other critical issues include incompatibility between the solar panels and the inverter, as well as the neglect of proper grounding, lightning protection, and surge protection measures. To ensure system quality, I recommend working only with registered, certified companies and requesting international test certificates for all components, such as those from the IEC or TÜV. Furthermore, it is essential to secure both a product warranty and an independent performance guarantee—covering at least 25 years for the solar panels—while ensuring there are clear, explicit terms regarding operational efficiency and annual degradation rates.
What are the technical and regulatory requirements necessary for expanding the use of solar energy systems in homes and factories?
There are several requirements that must be met to ensure safe and sustainable expansion. From a technical perspective, it is essential to verify the structural integrity of the rooftops to ensure they can support the solar panels and metal mounting structures. Furthermore, inverters must comply with the standards set by the electricity regulatory authority and be equipped with necessary protection systems—most notably, anti-islanding protection to prevent unsafe disconnection from the grid. Additionally, bi-directional meters must be installed to accurately measure both imported and exported electricity. From a regulatory standpoint, an application must be submitted to the relevant electricity distribution company, and all necessary approvals must be obtained prior to the commencement of installation. This must be done in adherence to the permitted capacity limits for grid connection, in accordance with the regulations governing net metering and self-consumption.
To what extent does Egypt currently possess the capacity to manufacture solar energy system components domestically? And which components could have their production localized?
Egypt possesses a solid industrial and assembly base; however, manufacturing capabilities vary depending on the level of technology, the complexity of components, and supply chain requirements. Certain components can be competitively localized—such as metal mounting structures, electrical cables and connectors, transformers, and distribution and assembly panels. Furthermore, there are local facilities engaged in the assembly of solar panels, which involve importing solar cells and integrating them into finished units.
Conversely, the importation of certain advanced components remains necessary—most notably electronic silicon cells, core chips, smart inverters, storage systems, and lithium batteries. This highlights the importance of shifting from mere component assembly toward building genuine manufacturing capabilities that encompass technology, research, and development.
What prevents local industry from achieving a cost and quality level that can compete with imported products?
The challenge is not a single factor, but rather a complex system of interconnected challenges. The scale of production is foremost among these; massive manufacturing facilities in China possess production capacities reaching tens of gigawatts annually, granting them significant cost advantages that smaller-scale producers struggle to compete with. Furthermore, the stability of demand is a critical factor, as the absence of a clear and sustainable project timeline deprives local manufacturers of the ability to plan for long-term investments.
There is also the rapid pace of technological evolution; panel technologies are constantly changing—from PERC to TOPCon and Heterojunction—which necessitates ongoing investment in research and development. Furthermore, high financing costs and the volatility in the prices of imported raw materials impact the final cost of the locally manufactured product.
How can large-scale solar projects be transformed from mere electricity-generating plants into a gateway for building a local industry that creates jobs and boosts exports?
This requires action along three main tracks. The first track involves establishing graduated local content requirements for new projects—starting at 30% and gradually increasing to 60%—in alignment with the capabilities of the local industry, as well as quality and competitive standards. The second track focuses on attracting international companies to establish joint ventures and specialized industrial zones within Egypt. This would be achieved by offering investment, tax, and customs incentives, while leveraging Egypt’s strategic geographic location and free trade agreements to access African and Arab markets. The third track entails developing technical and engineering talent and aligning university research centers with the needs of the industrial sector, which will facilitate technology transfer and enhance the quality of local production. Through this approach, solar energy investments can evolve from mere electricity-generation projects into an industrial base that creates job opportunities, boosts exports, and supports the national economy.
What are the key technical and economic risks that should be examined before implementing a large-scale solar project? And how can the impact of malfunctions and efficiency degradation on the return on investment be minimized?
Risk assessment serves as the cornerstone for safeguarding investments in large-scale solar projects. From a technical perspective, factors such as panel performance degradation—including Potential-Induced Degradation (PID) and Light-Induced Degradation (LID)—as well as the accumulation of dust and dirt, pose significant challenges, particularly in the Egyptian desert environment; if regular cleaning is not performed, these issues can lead to a loss in productivity exceeding 15% to 20%. Furthermore, attention must be paid to “hotspots” and inverter failures, both of which directly reduce power generation levels. From an economic standpoint, risks include fluctuations in exchange and interest rates, as well as the potential for forced curtailment—a scenario that occurs when the power grid is unable to accommodate the surplus electricity being generated.
This is where technological innovation—particularly nanotechnology—comes into play. Smart nano-coatings can be applied to the glass surfaces of solar panels, granting them self-cleaning properties and resistance to the adhesion of water and dust; this helps minimize dust accumulation and maintain production efficiency. Furthermore, dry robotic cleaning systems—which operate without consuming water—can be utilized, alongside drones equipped with thermal imaging cameras to detect “hot spots” and electrical faults at an early stage. These measures should be complemented by comprehensive operation and maintenance contracts, featuring clear performance indicators and production guarantees, to ensure the protection of the return on investment over the long term.
What role can solar energy play in reducing the production costs of Egyptian goods and enhancing their competitiveness, particularly in electricity-intensive industries?
Solar energy serves as a direct competitive tool for the national industrial sector, particularly in industries such as aluminum, cement, chemicals, and textiles. Since electricity accounts for a significant portion of production costs in these sectors, access to a clean, stable, and competitively priced energy source helps reduce operational expenses and shields manufacturing facilities from the price volatility of conventional fuels. Furthermore, the transition to clean energy contributes to lowering the carbon footprint of Egyptian products—a factor of growing importance given the implementation of the European Union’s Carbon Border Adjustment Mechanism (CBAM). Consequently, investing in solar energy not only yields savings on electricity bills but also enhances the prospects for Egyptian products to access global markets.
If Egypt aims to increase the share of renewable energy in its electricity mix over the coming years, what is the most pressing priority: building power plants, developing the grid, implementing storage solutions, or localizing the industry?
From a scientific and engineering perspective, developing the national grid and reinforcing it with batteries and storage systems is the top priority. Continuing to build new power generation plants without a smart, flexible transmission grid—equipped with sufficient storage capacity to manage the fluctuations in solar energy production—could lead to forced curtailment and the waste of generated electricity, which would negatively impact the economic viability of such investments. Once the grid is prepared and the storage infrastructure is developed, the next steps—accelerating the construction of new power plants and localizing the industry—will serve as complementary paths toward building an integrated and secure green energy system.
If you were asked to identify three practical measures that could make a tangible difference in the spread of solar energy in Egypt over the coming year, what would those measures be?
I believe there are three measures that could yield significant results within a short timeframe. First, simplifying and accelerating the procedures for connecting solar projects to the grid—particularly for industrial and commercial facilities, whether through net metering or wheeling mechanisms—would reduce administrative complexities and encourage investment. Second, introducing customs and tax incentives for electricity storage equipment, batteries, and industrial solar heating systems would lower capital costs and accelerate the adoption of these technologies. Third, enabling direct power purchase agreements (Corporate PPAs) between developers and the private sector via the national grid would facilitate an expansion of private investment in clean energy without imposing substantial direct investment burdens on the state. I contend that streamlining regulatory procedures and simplifying grid-connection processes represent some of the quickest and most cost-effective steps to implement, while simultaneously fostering a more favorable investment climate.
Dr. Iman Mohamed Mustafa concluded her remarks by emphasizing that Egypt possesses natural, investment, and industrial assets that position it to play a greater role in the future of renewable energy. However, to truly leverage these assets, the country must move beyond simply expanding the construction of power plants toward building an integrated ecosystem—one that encompasses smart grids, energy storage, local manufacturing, and scientific research.
It was emphasized that nanotechnology and industrial innovation represent significant opportunities to enhance the efficiency of solar panels and reduce operation and maintenance costs, particularly in desert environments. Furthermore, integrating solar energy projects with the national industrial sector could transform clean energy into a driver for economic growth and increased exports. It was also noted that the future of solar energy in Egypt will not be determined solely by the capacity to generate more electricity, but rather by the ability to manage this output efficiently, store surplus energy, localize technology, and convert natural resources into added value and sustainable investment opportunities.
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