IFC and MIGA, members of the World Bank Group, signed an agreement to support the development of a 252-megawatt wind farm by Lekela in Egypt’s Red Sea governorate.
IFC will provide $84 million in financing while MIGA will offer $122 million in financial guarantees, helping to bolster the production of clean energy, lower generation costs, and diversify the country’s energy mix.
The wind farm, West Bakr Wind, located in the Gulf of Suez, is expected to produce over 1,000 gigawatt hours per year, at a tariff well below the average cost of generation in Egypt, powering more than 350,000 homes.
“The West Bakr Wind project will play an important role in supporting the diversification of Egypt’s generation capacity by delivering competitively priced clean power in the country,” said Chris Antonopoulos, CEO of Lekela.
IFC’s contribution includes an A loan of up to $26 million and $58 million from IFC’s innovative syndications platform. MIGA is providing guarantees of up to $122 million to help Lekela manage non-commercial risk, said Sarvesh Suri, director for Operations in MIGA.
“The Lekela wind farm will help lower the average cost of electricity generation in Egypt and boost private sector participation in this key sector, while sending a strong signal to the market about our commitment to the country’s renewable energy program,” Walid Labadi, country manager in Egypt, Libya, and Yemen at IFC, said.
IFC and MIGA’s engagements complement the World Bank Development Policy Financing program, a new $1 billion program signed in December 2018 to support the second generation of Egypt’s reform program, which will focus on developing the private sector while enabling inclusive growth.