Solar Energy to Power Egypt's Aluminium Industry Through $66 Million AfDB Deal

The plant’s electricity will be sold exclusively to the Aluminium Company of Egypt, known as EgyptAlum, under a 25-year power purchase agreement.

The African Development Bank Group has signed a $66 million financing agreement for the first phase of Egypt's Dandara project, bringing solar power and battery storage to one of the country's most energy-intensive industries. The facility in Qena Governorate, southern Egypt, will combine 500 megawatts of solar generating capacity with a 100-megawatt-hour battery energy storage system. Dandara Solar Power S.A.E., the company that signed the agreement with the Bank, is a special purpose vehicle owned by Scatec and its partners.

The plant's electricity will be sold exclusively to the Aluminium Company of Egypt, EgyptAlum, under a 25-year power purchase agreement. EgyptAlum is one of Africa's largest aluminium producers, placing a major industrial electricity user at the centre of the project. The Egyptian Electricity Transmission Company will support the agreement by transmitting power from the solar plant to the aluminium facility.

The project is expected to become fully operational at the beginning of 2028, with estimated annual electricity generation of 1,373 gigawatt-hours. Its planned output is intended to provide EgyptAlum with clean, reliable and cost-effective power for an industry with substantial energy needs. The development is expected to reduce annual carbon dioxide emissions by roughly half a million tonnes, giving the investment an important environmental role alongside its industrial purpose.

Financing Covers Construction and Long-Term Operations

The Bank Group's Board of Directors approved the project in July 2026, with the $66 million package combining $46 million from ordinary Bank Group resources and $20 million in concessional funding from the Climate Investment Funds' Clean Technology Fund. An additional $151 million in debt financing will be mobilised from a consortium of development finance institutions, expanding the financial support available for the development. The funding will cover the design, construction, operation and maintenance of the photovoltaic power plant and its integrated battery energy storage system.

Stored Solar Power Supports Industrial Competitiveness

The battery system will supply renewable electricity during peak evening demand and help manage fluctuations in solar generation, making stored power available when it is needed. Dr Kevin Kariuki, the Bank's Vice President for Power, Energy, Climate and Green Growth, said the investment demonstrates how combining solar generation with storage can strengthen industrial competitiveness and lower carbon emissions. He linked those benefits to the changing requirements facing African manufacturers in international markets, including constraints associated with the European Union's Carbon Border Adjustment Mechanism, known as CBAM.

Jobs and Investment Support Sustainable Energy

The development is expected to create about 2,500 jobs during construction and 23 permanent roles during operation, with particular attention to employment opportunities for women and young people. It aligns with the Bank Group's Ten-Year Strategy 2024–2033, its Four Cardinal Points strategic vision and its Country Strategy Paper for Egypt. Mobilising commercial capital for energy projects forms part of the Bank's wider effort to increase and sustain access to sustainable energy sources across Africa.