Twin threads of Cairo’s sustainability drive received a boost in late January as the developer behind a project promising to convert solid waste into green hydrogen at vast scale announced receipt of preliminary approvals.

Tapping into a niche subsector of the burgeoning green hydrogen industry, the scheme, which would employ a greenfield plant at the mouth of the Suez Canal, aligns both with the government’s early moves into that sector and its longer-standing effort to interest investors in converting waste generated by a rapidly growing, urbanising population into clean energy.

Blessed with rich renewable resources, ample reserves of sparsely populated land and proximity to European markets, Egypt is in many respects well-placed to become a major green hydrogen producer. In common with its regional competitors, the government began devoting attention to hydrogen in early 2021, as the emergency of the coronavirus pandemic passed and the international energy industry returned to life.

A letter of intent with German electricity giant Siemens, pledging to carry out a 100-200MW pilot project as part of a wider collaboration to develop the sector, was followed by similar deals of varying firmness with Belgian, German, Italian and Norwegian partners.

300,000t/yr – Potential hydrogen production

The oft-promised publication of an overarching hydrogen strategy remains pending, but in December, energy minister Mohamed Shaker declared 2022 “the year of green hydrogen”. Impetus is being provided by the desire both to secure early-mover advantage and to be able to showcase progress at Cop27, scheduled to convene at Sharm el-Sheikh in November.

A consortium led by Oslo-based Scatec is aiming to have first production from a 100MW green hydrogen and ammonia plant at Ain Sokhna, announced in October, online in time for Cop27. The problem of bankability in an unproven market has been resolved by the project’s UAE/Dutch shareholder Fertiglobe, which owns an ammonia plant nearby, signing up as sole offtaker.

However, the waste-to-hydrogen scheme launched last month—the world's largest of its kind to-date—is of a different magnitude. On 31 January, New York-based H2 Industries proclaimed initial approval from the General Authority of the Suez Canal Economic Zone to develop a plant at East Port Said deploying integrated thermolysis to process 4mn t/yr of organic waste and non-recyclable plastic into 300,000t/yr of clean hydrogen—at an estimated cost of $3bn. The output would be bonded to a liquid organic hydrogen carrier for export from an ideal location at the European end of one of the world’s busiest shipping lanes.

Cost competitive

A feasibility study is scheduled for completion by the end of March, after which work will start with a view to having the first of the three phases onstream by early 2026, with full capacity to be reached within five years. The German developer says the production cost will be half that of electrolysis-based green hydrogen and will also undercut blue and grey hydrogen.

Cairo’s record for getting major downstream energy projects off the ground in a timely fashion is hardly stellar, while the novelty and scale of the scheme also render the timetable somewhat improbable.

Nonetheless, the government has long aspired to find productive use for the burgeoning volumes of waste. A ten-year National Solid Waste Management Programme running up to this year posits a role for waste-to-energy projects, and a feed-in system for developers of such facilities was launched in 2019. However, interest has generally been weak, with prospective investors complaining that the tariff of EGP1.4/kWh (9ȼ/kWh)—equal to that available for solar and wind—is too low to be profitable, given higher upfront and operating costs and the authorities' refusal to allow the levying of gate fees. H2 Industries claims to have offered its project to several countries: it is no surprise that Egypt proved the most enthusiastic.

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Author: Clare Dunkley