Hot on the heels of the long-awaited release of definitive guidelines on SPV incorporation (on which we reported on 7 April), the Egyptian Electricity Transmission Company has released discussion drafts of the major project documents proposed for Egypt’s renewable feed in tariff. This programme was launched at the end of 2014 and the first round of bidders was prequalified almost immediately thereafter. Those prequalified bidders are now gearing up to execute their projects – and it is becoming increasingly apparent that this will require them to move with some rapidity.
The issuance of the key project documents marks a significant milestone. The documents that were released are the power purchase agreement, usufruct agreement (which will govern the access to government land, since most if not all of the projects are expected to be built on government land), network connection contract, a cost sharing deed and the PPA direct deed.
Developers have been instructed to provide all comments by 28 April and they have been invited to join in a workshop with government authorities to discuss them on 14-16 April. It is widely expected that this will be the only opportunity for developers and lenders to comment on these critical documents. Given the importance of this process and the fact that the documents were issued slightly later than originally announced, some developers anticipate that the announced dates for the workshops and the deadline may be adjusted. However, no adjustment has been made to date.
Egypt therefore appears to be moving forward with this programme with a great deal of seriousness. Developers and lenders will need to be equally serious – and move very quickly – if they wish to take full advantage of this opportunity.