The African Development Bank has approved up to $66 million in financing for the first phase of the Dendera Solar Energy Project in Qena Governorate, one of Egypt’s largest clean-energy projects dedicated to supplying the industrial sector.

The project involves the construction of a 500-megawatt solar power plant supported by a 100-megawatt-hour battery energy storage system. The facility is designed to provide a stable supply of clean electricity during periods of peak demand and enhance the efficiency and reliability of renewable energy use.

The financing package includes $46 million from the African Development Bank’s ordinary resources and $20 million in concessional funding from the Clean Technology Fund, part of the Climate Investment Funds. The remaining financing is expected to be secured through a consortium of development finance institutions, bringing the project’s total investment cost to more than $290 million.

The plant is expected to become fully operational in early 2028 and generate approximately 1,373 gigawatt-hours of clean electricity annually, supporting Egypt’s efforts to expand renewable energy capacity and reduce its dependence on conventional fuels.

The project is expected to deliver significant environmental and economic benefits, including reducing carbon dioxide emissions by approximately 500,000 tonnes annually. It will also create around 2,500 jobs during the construction phase and 23 permanent positions once operations begin.

Egypt Aluminium Company, known as EGAL, will be the sole purchaser of the electricity generated under a 25-year power purchase agreement. The electricity will be transmitted through Egypt’s national grid in cooperation with the Egyptian Electricity Transmission Company.

Kevin Kariuki, the African Development Bank’s vice president for power, energy, climate and green growth, said the project represents a practical model for reducing emissions in the industrial sector.

He added that the project would strengthen EGAL’s ability to maintain its position in European markets amid the implementation of the European Union’s Carbon Border Adjustment Mechanism, while helping safeguard more than 6,000 jobs.

Over its operational lifetime, the project is expected to prevent approximately 12.5 million tonnes of carbon dioxide emissions.

Wale Shonibare, the bank’s director of energy financial solutions, policy and regulation, described the project as the largest private power purchase agreement in Egypt and the wider region. He said it could serve as a model for attracting further investment into renewable energy and low-carbon industrial development.

The project is aligned with the African Development Bank’s 2024–2033 strategy, which seeks to expand access to sustainable energy across Africa by encouraging greater private-sector participation in electricity infrastructure financing.

The announcement also follows EGAL’s signing of a $900 million agreement with commodities group Trafigura to expand its aluminium complex in Nag Hammadi.