Chapter 6 | PROJECTS
The OPEC Fund operation comprises a US$30 million 11 loan to co-finance the development and construction of two 550 MW installations at the Gulf of Suez Wind Power Plant in Egypt, Africa’s largest onshore wind power project. The project, promoted by the Saudi ACWA Power Company (sponsor) and the Egyptian Suez Wind Energy S.A.E. (project company), aims to increase the share of renewable energy in Egypt’s power generation mix by harnessing the country’s significant wind energy potential. Located near Ras Ghareb on the western coast of the Gulf of Suez, the project will contribute to Egypt’s energy transition strategy to raise renewable energy production to around 40 percent of its energy mix by 2035, strengthen energy security, reduce greenhouse gas emissions and promote private sector participation in clean energy infrastructure.
Situation Analysis of Climate Impacts
and assets in low-lying, flood-prone areas. According to the US ND-GAIN rankings, the impacts will require strong ad- aptation measures to remain manageable. 14 The EU INFORM Risk Index puts Egypt, with its arid climate and heavy de- pendence on the Nile, in the medium-high risk category. 15
Egypt faces growing climate risks that threaten its people, economy and infrastructure. Rising temperatures, projected to increase by 1.5-3°C by mid-century, are already driving more frequent extreme heat events. Water scarcity is another critical challenge as Egypt de- pends on the Nile for 97 percent of its freshwater. 12 Climate change is increasing the uncertainty around Nile flows, while population and economic growth are pushing water demand beyond renewable supply. Sea levels are also rising, placing low-lying coastal areas like the Nile Delta at serious risk of flooding, erosion and salt- water intrusion. Cities such as Alexandria could face major economic losses, with damage costs from sea-level rise esti- mated at around 1 percent of GDP by 2030 under mid-range scenarios. Although Egypt is largely arid, intense rainfalls are expected to become more frequent, triggering flash floods and affect- ing over a million people annually. Dust and sandstorms are also projected to intensify, disrupting transport, reducing air quality and hindering solar power generation. These growing climate extremes highlight the need for climate-resilient infrastructure. The energy sector is under stress from both higher cooling demands and constrained water resources for power generation. Coastal energy facilities are increasingly exposed to sea-level rise and storm surges, reinforcing the urgency of diversifying energy sources and strengthening grid resilience to avoid disrup- tions and economic losses. 13
The OPEC Fund’s contribution to Climate Resilience in Egypt
Purpose of the Loan
The primary goal of the OPEC Fund’s operation is to support the Suez Wind Power Plant, which seeks to boost Egypt’s re- newable energy capacity by installing and operating wind tur- bines in the Gulf of Suez region — an area known for its strong and consistent wind resources. The project will contribute clean power to the national grid, helping to diversify Egypt’s energy mix, reduce dependence on natural gas and other car- bon-intensive sources and enhance overall energy security and reliability. In doing so, it supports Egypt’s national climate and development strategies, aligning with the country’s NDCs by increasing the share of renewable energy to around 40 percent by 2035 to achieve its development goals and meet the country’s growing demand while reducing greenhouse gas emissions. Additionally, the project is designed to foster greater private sector participation by engaging private in- vestors and financing institutions, strengthening the broader investment landscape for renewable energy in Egypt.
Expected Outcomes
The Gulf of Suez Wind Power Plant is expected to deliver tangible social, economic and environmental benefits. It will contribute a substantial amount of wind-generated electri city to the national grid, reducing reliance on fossil-fuel-based power plants and lowering overall greenhouse gas emissions. By displacing gas or coal-fired electricity the wind farm will help avoid thousands of tons of CO 2 -equivalent emissions
Egypt is recognized as highly vulnerable to the impacts of climate change, with key drivers including water stress, high agricultural sensitivity and the concentration of people
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