Government keeps 2% in annual fees on land usufruct for renewable energy projects

Mohamed Farag
2 Min Read

The government decided to keep the land usufruct fees for new and renewable power plants at 2% of the annual energy produced.

Executive Chairperson of the New and Renewable Energy Authority (NREA), Mohamed El-Khayat, told Daily News Egypt that the related law has set the land usufruct fees at 2% for solar and wind power plants, adding that this law is applied in coordination with the ministry of local development and all governorates.

Several foreign investors have applied to establish solar power plants in different governorates, but each governorate sets different fees for allocating the land under the usufruct system, ranging between 5-7% of the annual energy produced.

El-Khayat explained that the NREA agreed with governorates to set the land usufruct fees at 2% of the annual energy produced, which is the same value imposed by the NREA on its lands.

In April 2015, the cabinet approved the land usufruct licensing regulations for the establishment of power plants from renewable resources.

An official in the ministry of electricity said that the ministry is communicating with the Egyptian Electricity Transmission Company (EETC), and distribution companies, in order to determine the available power capacities at transformer stations so as to link the production of these projects to the national grid.

The EETC began to develop and expand in establishing electricity transformer stations in order to absorb the expected capacities from solar and wind power plants.

The official added that XD-Egemac has completed four transformer stations in Benban to transfer energy produced from the solar energy feed-in tariff projects before the completion of the production stations. This applies to all regions, as the EETC is committed to completing the transformer stations for all the projects.

He revealed that the EETC will offer tenders for the establishment of three transformer stations in Upper Egypt and the Delta before the end of August, with investments worth EGP 4bn, as part of the EETC’s expansion plans.

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