- Egypt’s peak electricity demand rose 12% year on year to more than 37 GW during the summer of 2024, increasing pressure on grid stability and energy security.
- The government plans to commission 600 MW of energy storage capacity in 2026 while targeting renewables to contribute 42% of total power generation by 2030.
- Utility scale solar and storage projects alongside local manufacturing investment are positioning Egypt as a major energy storage hub in the MENA region.
Egypt’s energy storage market is entering a rapid growth phase as the country responds to mounting electricity demand, natural gas supply constraints and ambitious renewable energy targets, according to a new report by InfoLink.
As the largest population centre in the MENA region with more than 114 million residents, Egypt is experiencing sustained growth in electricity consumption driven by economic recovery and industrial expansion.
Pressure on the national grid intensified during the summer of 2024 when peak demand exceeded 37 GW, representing a 12% year on year increase. The surge forced authorities to introduce emergency measures including temporary power rationing, spot purchases of liquefied natural gas and staggered electricity consumption for commercial and industrial users.
The situation highlighted a structural challenge within Egypt’s power sector. While installed generation capacity remains substantial, the system lacks sufficient flexibility to manage peak demand fluctuations and disruptions in fuel supply.
Egypt’s generation mix continues to rely heavily on fossil fuels. By the end of 2024, the country’s installed power capacity reached 59.7 GW, with thermal generation accounting for more than 88% of the total. Renewable energy capacity increased to about 9.1 GW by early 2026 as solar PV and wind projects accelerated grid connection activity. However, gas fired power generation still dominates the electricity mix.
The Egyptian government has reaffirmed its target for renewable energy to contribute 42% of total electricity generation by 2030. Achieving this goal will require significant expansion of solar and wind capacity, increasing the need for energy storage systems capable of balancing intermittent renewable generation and stabilising the grid.
Electricity tariff reforms are also strengthening the business case for energy storage deployment. Over the past two years, Egypt has raised electricity prices for residential, commercial and high consumption users as the country grapples with rising LNG import costs and subsidy pressures.
As electricity costs become a growing concern for industrial users, energy storage is evolving beyond its traditional role of supporting renewable integration. Businesses are increasingly exploring storage systems for peak shaving, load shifting, improved power reliability and corporate decarbonisation strategies.
Egypt’s policy framework for the sector is anchored by the Integrated Sustainable Energy Strategy to 2035, revised in 2022 by the Ministry of Electricity and Renewable Energy. In February 2026, the ministry confirmed plans to commission 600 MW of storage capacity during the year to support grid stability and facilitate the addition of 3 GW of new solar PV capacity.
The market remains largely project driven, with utility scale solar plus storage projects emerging as the dominant development model. Energy storage is increasingly viewed as a core component of renewable energy infrastructure rather than an optional addition.
Norwegian developer Scatec has emerged as one of the leading international players in the market. Its Obelisk Phase I development includes 1.1 GW of solar PV combined with a 100 MW/200 MWh battery energy storage system and has already achieved financial close and entered construction.
In January 2026, Egypt signed a further agreement with Scatec and Sungrow covering 1.7 GW of solar PV and 4 GWh of energy storage capacity. The agreement expands Scatec’s total project portfolio in Egypt to 1.95 GW of solar PV and 3.9 GWh of storage.
Other large scale projects are also moving forward. Infinity Power and Hassan Allam Utilities are advancing a project at the Benban solar park that combines 200 MW of solar PV with 120 MWh of energy storage. Chinese battery manufacturer Hithium is supplying the storage system.
Alongside project development, Egypt is rapidly building local manufacturing capacity across the renewable energy and storage value chain. The country’s strategic location within the Suez Canal Economic Zone, combined with investment incentives and growing domestic demand, is attracting international manufacturers seeking a regional production base.
Chinese companies are playing a central role in this localisation drive. Sungrow is planning a 10 GWh battery manufacturing facility in the Suez Canal Economic Zone, while Cornex is developing a 5 GWh battery project in partnership with Egypt based Kemet.
TBEA has partnered with Kemet to establish Egypt’s first locally produced grid connected inverter manufacturing line, while PowerChina continues to expand its role in engineering, procurement and construction activities across the renewable energy sector.
According to InfoLink, Egypt is expected to add between 2.7 GW and 4.5 GW of energy storage power capacity by 2028, representing between 6.2 GWh and 12 GWh of storage capacity. Total installed storage capacity could reach between 2.9 GW and 4.8 GW by the end of 2028.
Utility scale projects are expected to account for more than 80% of installed capacity during this period, although commercial and industrial storage applications are projected to gain momentum after 2027 as electricity prices rise and private green power mechanisms mature.
Egypt is increasingly being viewed as one of Africa’s most important emerging energy storage markets. While the sector remains at an early stage of development, the country already offers several of the core fundamentals investors seek, including rising demand for grid flexibility, clear government targets, a growing pipeline of bankable projects and improving local manufacturing capability.
For developers, investors and EPC contractors, Egypt’s market opportunity now lies not in whether to enter, but in how quickly they can establish a position across the renewable energy and storage value chain.
Author: Bryan Groenendaal
