Energy in Egypt
Egypt is classified as having a “high power system size (24,700 MW installed generation capacity in 2010 with more than 40 grid-connected plants).” As of 2010, 99% of the Egyptian population has access to electricity.
When electricity was first introduced in Egypt in 1893, the generation and distribution of electricity was practiced exclusively by private companies. In 1962, the generation, transmission, and distribution of electricity were nationalized under three authorities (the Electricity Production Authority, the Electricity Distribution Authority, and the Electricity Projects Implementation Authority) leaving the government as the sole owner and operator of all electrical companies. These three authorities were replaced in 1965 by the public Egyptian Corporation for Electricity which remained active until 1976 when it was converted into the Egypt Electricity Authority as decreed by electricity sector Law no. 12. In 1978 the Egypt Electricity Authority supervised the establishment of seven geographically divided electricity distribution companies. An additional electrical power distribution authority was established in 1983 as a means of supervising distribution companies which had become independent of the Egypt Electricity Authority.
Between 1996 and 2000 a series of laws and presidential decrees were passed to reorganize and regulate the growing electrical industry.
- 1996: Electricity sector Law no. 100 was issued, opening up the industry by allowing for the construction, operation, and maintenance of electric generation stations by both local and foreign investors.
- 1997: The Electric Utility and Consumer Protection Regulatory Agency was established under presidential decree no. 326 to regulate, supervise, and monitor the relation between the associated electric utility parties.
- 1998: Electricity sector Law no. 18 was issued declaring that all generation stations and the high voltage network were to be affiliate to the distribution companies which, in turn, were to be affiliate to the Egyptian Electricity Authority rather than the business sector.
- 2000: presidential decree no. 339 and electricity sector Law no. 164 were issued. Presidential decree no. 339 reorganized the Electric Utility and Consumer Protection Regulatory Agency while electricity sector Law no. 164 enacted the conversion of The Egyptian Electricity Authority to a contribution company called the Egyptian Electric Holding Company (EEHC).
Between 2000 and 2001, the EEHC implemented a division in the organization of Egypt’s electrical management framework. Generation (production) activity was separated from distribution activity along with the separation of control and transmission between ultra-high-voltage and high-voltage networks. This division rearranged the industry to consist of 13 companies: one company for electricity transmission, one company for hydroelectric power production, four companies for thermal power production, and seven companies for electricity distribution. In 2002 the Delta Company for electricity distribution divided into North Delta and South Delta increasing the number of companies to 14. In 2004 the Cairo company for electricity distribution divided into North Cairo and South Cairo in addition to the Delta company for electricity production dividing into three companies: East Delta, Middle Delta and West Delta.
- Distribution companies: North Cairo, South Cairo, Alexandria, Canal, North Delta, South Delta, El- Behera, Middle Egypt, and Upper Egypt Electricity Distribution Companies
- Production companies: The production companies are made up of Cairo, East Delta, Middle Delta, West Delta, Upper Egypt, and Hydro Plants Electricity Production Companies
- Transmission company: Egyptian Electricity Transmission Company
A US$239 million electricity network link with Jordan was completed in 1998. In late 2002 Egypt announced that it would coordinate a regional energy distribution center to coordinate energy distribution among the nations of the region, including Egypt, Jordan, Syria, Lebanon, Iraq, Libya, Tunisia, Algeria, and Morocco.
Since the early 2000s, power outage rates and durations as well as distribution system losses have trended downwards indicating that distribution companies have improved their overall customer service quality over the past decade; however, Egypt has seen a great weakening in its supply security. The power system’s generation reserve capacity declined from 20% in the early 2000s to 10% by the 2010s. The Egyptian power system is now significantly less able to avoid power shortages during annual peak demand periods, which are typically the afternoons on the hottest days of the year.
The weakening of Egypt’s supply security has caused widespread social issues in the 2010s. To deal with the extremely high demand for electricity, rolling blackouts and power cuts were implemented throughout the summer of 2012 causing great tension between the government and the people of Egypt. Angry residents from many villages protested the rolling blackouts by threatening to not pay their electricity bills and to sue their electricity provider. A campaign entitled “We Will Not Pay” was organized to encourage people to not pay their bills until the electrical service was stable once again. Residents from the Bardeen village in Zagazig also protested the unstable supply of electricity by blocking the Belbeis-Zagazig road. The government released statements encouraging people to ration their electricity consumption and announced that work was being done to generate an additional 1800 MW of energy. Minister of Petroleum Abdullah Ghorab reiterated the importance of conserving electricity to avoid a state implemented policy of load shedding.
Egypt is an important non-OPEC energy producer. It has the sixth largest proved oil reserves in Africa. Over half of these reserves are offshore reserves. Although Egypt is not a member of OPEC, it is a member of the Organization of Arab Petroleum Exporting Countries.
Commercial quantities of oil were first found in 1908, and more petroleum was found in the late 1930s along the Gulf of Suez. Later, large oil fields were discovered in the Sinai Peninsula, the Gulf of Suez, the Western Desert, and the Eastern Desert. The Abu Rudeis and Ra's Sudr oil fields in the Sinai, captured by Israel in 1967, were returned to Egyptian control in November 1975, and the remaining Sinai oil fields reverted to Egyptian control by the end of April 1982. As of 2005, Egypt's proven oil reserves were estimated at 3.7 billion barrels (590×106 m3), of which 2.9 billion barrels (460×106 m3) was crude oil and 0.8 billion barrels (130×106 m3) were natural gas liquids. Oil production in 2005 was 696,000 barrels per day (110,700 m3/d), (down from 922,000 barrels per day (146,600 m3/d) in 1996), of which crude oil accounted for 554,000 barrels per day (88,100 m3/d).
Approximately 50% of Egypt's oil production comes from the Gulf of Suez, with the Western Desert, Eastern Desert, and the Sinai Peninsula as country's three other primary producing areas. Domestic consumption was estimated at 564,000 barrels per day (89,700 m3/d) in 2004. Net oil exports in that same year were estimated at 134,000 barrels per day (21,300 m3/d). The Suez Canal and the 322-kilometre (200 mi) Sumed pipeline from the Gulf of Suez to the Mediterranean Sea are two routes for oil from the Persian Gulf, which makes Egypt a strategic point of interest in world energy markets. Although the Suez Canal Authority (SCA) has deepened the canal so that it can accommodate the largest bulk freight carriers, the canal was deepened a further 20 metres (66 ft) in 2006 to accommodate very large crude carriers (VLCCs).
As of 2005, Egypt operates nine refineries that are capable of processing crude oil at an estimated rate of 726,250 barrels per day (115,465 m3/d). The largest refinery is the El-Nasr facility located at Suez. It is able to process 146,300 barrels per day (23,260 m3/d). The National oil company is the Egyptian General Petroleum Corporation.
Major discoveries in the 1990s have given natural gas increasing importance as an energy source. As of 2005, the country's reserves of natural gas are estimated at 66 trillion cubic feet (1.9×1012 m3), which are the third largest in Africa. Probable reserves have been placed at or more than 120 trillion cubic feet (3.4×1012 m3). Since the early 1990s, significant deposits of natural gas have been found in the Western Desert, in the Nile Delta and offshore from the Nile Delta. Domestic consumption of natural gas has also risen as a result of thermal power plants converting from oil to natural gas. Egypt's production of natural gas was estimated at 2,000 billion cubic feet (57×109 m3) in 2013, of which almost 1,900 billion cubic feet (54×109 m3) was domestically consumed.
Natural gas is exported by the Arab Gas Pipeline to the Middle East and in the future potentially to Europe. When completed, it will have a total length of 1,200 kilometres (750 mi). Natural gas is exported also as the liquefied natural gas (LNG). LNG is produced at LNG plants of Egyptian LNG and SEGAS LNG companies. BG and Eni, the Italian oil and gas company, together with Gas Natural Fenosa of Spain, built major liquefied natural gas facilities in Egypt for the export market, but the plants have been largely idled as domestic gas consumption has soared.
In March 2015, BP Signed a $12 Billion Deal to Develop Natural Gas in Egypt intended for sale in the domestic market starting in 2017. BP said it would develop a large quantity of offshore gas, equivalent to about one-quarter of Egypt’s output, and bring it onshore to be consumed by customers. Gas from the project, called West Nile Delta, is expected to begin flowing in 2017. BP said that additional exploration might lead to a doubling of the amount of gas available. In September 2015 Italian energy company Eni SpA announced the discovery of the largest gas field in the Mediterranean, the Zohr gas field. The total gas in place of the Zohr gas field is estimated around 30 trillion cubic feet (850×109m³).
The Safaga-Quseir area of the Eastern Desert is estimated to have reserves equivalent about 4.5 million barrels (720×103 m3) of in-place shale oil and the Abu Tartour area of the Western Desert is estimated to have about 1.2 million barrels (190×103 m3) of in-place shale oil. The 1000 to 2000 foot thick and organically rich, total organic content of about 4%, Khatatba Formation in the Western Desert is the source rock for wells there and is a potential source for shale oil and shale gas. Apache Corporation, using substantial assets acquired in 2010 from BP after the Deepwater Horizon disaster, is the major operator in the Western Desert, often in joint ventures with Egyptian General Petroleum Corporation (EGPC) such as Khalda Petroleum Company and Qarun Petroleum Company. In 1996 Apache merged with Phoenix Resources, which had made the Qarun discovery in 1994, and took over operations of the Qarun Concession in Egypt. Apache has developed about 18% of the 10 million acres it controls, in 2012 running a score of rigs; drilling about 200 development and injection wells; and about 50 exploration wells with a success rate of about 55%. Plans for 2013 included an investment of about $1 billion in development and exploration. On August 29, 2013 Apache announced sale of a 1/3 share of its Egyptian assets to Sinopec for $3.1 billion effective January 1, 2014; Apache would continue to be the operator.
Oil shale resources were discovered in the Safaga-Quseir area of the Eastern Desert in the 1940s. The oil shale in the Red Sea area could be extracted by underground mining. In the Abu Tartour are, oil shale could be mined as byproduct whilst mining for phosphates. Oil shale in Egypt is foreseen as a potential fuel for the power generation.
Egypt is considering the use of nuclear energy. In 1964, a 150 MWe and in 1974 a 600 MWe nuclear power stations were proposed. The Nuclear Power Plants Authority (NPPA) was established in 1976, and in 1983 the El Dabaa site on the Mediterranean coast was selected. Egypt's nuclear plans were frozen after the Chernobyl accident. In 2006, Egypt announced it will revive its civilian nuclear power programme, and to build a 1,000 MW nuclear power station at El Dabaa. It estimated to cost US$1.5bn, and it will be constructed in participation of foreign investors. In March 2008, Egypt signed with Russia an agreement on the peaceful uses of nuclear energy.
The majority of Egypt’s electricity supply is generated from thermal and hydropower stations. The four main hydroelectric generating stations currently operating in Egypt are the Aswan Low Dam, the Esna Dam, the Aswan High Dam, and the Naga Hamady Barrages. The Asyut Barrage hydropower plant is scheduled to be commissioned and added as a fifth station in 2016.
Almost all hydroelectric generation in Egypt comes from the Aswan High Dam. The Aswan High Dam has a theoretical generating capacity of 2.1GW; however, the dam is rarely able to operate at full design capacity due to low water levels. An ongoing refurbishment program is being enacted to not only increase the generating capacity of the dam to 2.4GW, but also extend the operational life of the turbines by about 40 years.
In 2011, Egypt produced 156.6 TWh gross, of which 12.9 TWh came from hydroelectric generation. The per capita consumption of electricity at the end of 2012 was 1910 kWh/yr, while Egypt’s hydropower potential in 2012 was about 3,664 MW. As of 2009-2013, hydropower made up about 12% of Egypt’s total installed power generation capacity – a small decline from 2006-2007 when hydropower made up about 12.8%. The percentage of hydropower energy is steadily declining due to all major hydropower sites having already been developed with a limited potential for further increase in generating capacity. Outside of the Aswan High Dam, the other hydropower sites are considered very modest and most new generation plants being built in Egypt are based on fossil fuels. Even with the addition of the Asyut Barrage hydropower plant in 2016, hydropower development in Egypt is still lagging as the existing and developed hydropower plants are no longer being constructed at a rate that can support the increasing demand for electricity consumption in Egypt.
Egypt has a high solar availability. The total capacity of installed photovoltaic systems is about 4.5 MWp. They are used in remote areas for water pumping, desalination, rural clinics, telecommunications, rural village electrification, etc. The proposed large scale solar power project Desertec involves also Egypt. Egypt has also a high potential for wind energy, especially in the Red Sea coast area. As of 2006, 230 MW of wind energy was installed, with additional 320 MW to be installed by 2009.
The country in some areas receives over 4,000 hours of sunshine per year which is among the highest quantities registered in the world. Due to the sharp population growth and a series of blackouts during the summer caused by shortage supply, Egyptian demand of solar energy is increasing. However, only 1% of the electricity is produced by solar energy. The main part of the solar energy available in the country derives from small/scale projects. The only big projects, up to 10MW, are constituted by hybrid sola/diesel solutions which are developed by the Emirati company, Masdar.
In 2009, 430 MW of wind power were installed. Because the potential for hydroelectricity is largely utilized, the Supreme Council of Energy’s goal of increasing renewable energy to 20% by 2020 is expected to be reached predominantly through the development of wind power as solar remains too costly. Wind power is expected to reach 12% (a power capacity of about 7200 MW) of total electricity output with hydro (100 MW of CSP power) and solar (1 MW of PV power) making up the remaining 8%.
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