A sunnier future for Egyptian aluminium: Egyptalum's aluminium decarbonisation drive advances as Scatec begins 569 MW solar project

Scatec has begun construction of the first phase of a major solar power project that will supply renewable electricity to the Aluminium Company of Egypt (Egyptalum), advancing the Egyptian producer's efforts to reduce the carbon footprint of its aluminium operations.

The first phase of the Dandara Solar Power project comprises a 569 MW solar plant supported by a 100-MWh battery energy storage system. The Norwegian renewable energy company has also signed loan agreements to finance the development, which was first announced in 2025.

Under a 25-year power purchase agreement, the facility will supply clean electricity to Egyptalum. Once operational, the first phase is expected to generate approximately 1.4 TWh of renewable power annually and avoid more than 550,000 tonnes of carbon dioxide emissions each year.

Egyptalum said the project would help lower its carbon footprint and support compliance with evolving trade-related environmental standards. The company also expects the shift towards renewable electricity to strengthen the appeal and international competitiveness of Egyptian products.

Commercial operations for the first phase are targeted for the first half of 2028, while Scatec expects construction of the second phase to begin in the first half of 2027.

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Scatec CEO Terje Pilskog said, "Dandara is another major milestone in Scatec’s journey in Egypt. Building on the successful delivery of Obelisk, Africa’s largest hybrid solar and battery installation, we are now bringing the same integrated model to industrial decarbonisation at scale.”

“Supplying renewable power to one of Egypt’s most energy-intensive industries under a long-term agreement backed by a sovereign guarantee demonstrate the quality of what we are building in Egypt, and the confidence that leading development finance institutions place in Scatec as a partner”, he stated later. 

The first phase carries an estimated capital expenditure of USD 271 million, with USD 217 million in non-recourse project financing secured from the European Bank for Reconstruction and Development (EBRD), the African Development Bank (AfDB) and the European Investment Bank (EIB). The financing represents approximately 80 per cent of the phase's estimated capital expenditure.

Scatec has also signed a partnership agreement with the National Bank of Egypt (NBE), which will take a 20 per cent ownership stake in the project. Following the agreement, Scatec holds a 56 per cent interest in Dandara, comprising a 36 per cent stake through the EBRD platform and a further 20 per cent outside the platform.

The company will provide engineering, procurement and construction (EPC), asset management, and operations and maintenance services. Its EPC scope accounts for approximately 80 per cent of the first phase's total capital expenditure.

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