Norwegian renewable energy company Scatec ASA has begun construction on its 1.1 GW Obelisk solar project in Egypt, which includes a 100 MW/200 MWh battery storage system. Scatec revealed that the electricity from the plant once completed will be sold under a 25-year, USD-denominated Power Purchase Agreement (PPA) with the Egyptian Electricity Transmission Company (EETC), supported by a sovereign guarantee.
Scatec secured USD 120 million in equity bridge loans (EBL) for the solar project, deferring equity injections until construction is completed. The financing includes a USD 90 million EBL from The Arab Energy Fund, maturing in Q2 2028, and a USD 30 million EBL from the European Bank for Reconstruction and Development (EBRD), with maturity in Q1 2027.
The renewable energy developer confirmed that it signed a mandate letter with a consortium of development finance institutions for the long-term non-recourse project debt at attractive terms, with financial close expected in the next few months. The company is also in advanced discussions with potential equity partners, expected to conclude in the same timeframe.
“We are proud to break ground on Egypt’s first hybrid solar and battery project, building on our proven track record with similar developments,” said Terje Pilskog, Scatec CEO.
“Egypt has ambitious targets to build out significant renewable energy capacity in the coming years, and this milestone further strengthens Scatec’s position as a leading renewable energy producer in the country,” added Pilskog.
Scatec to be the EPC provider for the solar project
Scatec has outlined a two-phase development plan for the project. The first phase of 561 MW solar + 100 MW/200 MWh battery storage is targeted to reach commercial operational date (COD) in the first half of 2026, and the second phase of 564 MW solar in the second half of 2026.
Total capex for the project is approximately USD 590 million, to be partly financed by a targeted 80% non-recourse long-term project debt. Scatec will deliver Engineering, Procurement and Construction (EPC), Asset Management (AM), and Operations & Maintenance (O&M) services for the project.
Scatec’s EPC scope is approximately 70% of total capex, reduced from previous communication due to optimisation of the EPC structure but with unchanged gross profit to Scatec.
