Lafarge Egypt signs US$93M solar energy deal with Lumika Renewables

EGYPT – Lafarge Egypt, part of cement giant Holcim Ltd, has signed a US$93 million deal with Lumika Renewables to offtake electricity from a solar park.

Lumika Renewables is a joint venture of South Africa-based industrial group Reunert and A.P. Moller Capital.

The joint business was created in 2021 to develop a portfolio of cost-efficient, renewable energy solutions for commercial and industrial customers in Africa.

Under a long-term agreement, Lumika will set up its first solar park in the North African country with a capacity of up to 50 MW to supply clean energy to Lafarge’s Ain Soukhna cement plant in the Suez governorate.

The deal will allow Lafarge Egypt to procure 140 GWh of green electricity a year from the facility to power its cement factory in Ain Al-Sokhna, Suez Governorate.

With the offtake deal, the cement maker aims to boost the share of clean power to 50% of the electricity used during the day at the plant. The agreement will enter into force by the first quarter of 2024.

With about 2,000 employees, Lafarge Egypt’s factory in Ain Al-Sokhna has a capacity of 10.2 million tonnes per year and annual power consumption of about 750 GWh.

The deal reflects Egypt’s efforts to increase its green energy portfolio as the country is in the process of shifting to sustainable and renewable sources of energy.

The North African country intends to increase the supply of electricity generated from renewable sources to 20% by 2022 and 42% by 2035, with wind providing 14 percent, hydropower 2 percent, photovoltaic (PV) 22 percent, and concentrating solar power (CSP) 3 percent by 2035.

The government is cognizant of the need for a sustainable energy mix to both address increasing demand, and to move to a more environmentally sustainable and diverse electricity sector.

The 2035 Integrated Sustainable Energy Strategy, which builds on previous strategies, emphasizes the importance of renewable energy.

With the country’s abundant possession of land, sunny weather, and high wind speeds, renewable energy projects can be easily achieved.

As part of Egypt Vision 2030, to increase local content in all fields, the Ministry of Electricity and Renewable Energy (MOERE) has succeeded in reaching 30 percent local content for wind farms in 2018.

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