Egypt Revises its Renewable Energy Targets to Prioritize Natural Gas

Egypt's Petroleum Minister Karim Badawi announced on Sunday that the country has adjusted its 2040 renewable energy goal from 58 per cent to 40 per cent, emphasising the continued importance of natural gas in Egypt's energy portfolio.

Before hosting the COP 27 climate conference in 2022, Egypt promised to increase renewable energy generation to 42 per cent of its energy blend by 2035, later pushing forward that net zero goal to 2030. In June 2024, former Electricity Minister Mohamed Shaker revealed an ambitious goal to increase this to 58 percent by 2040, which has now been discarded.

Despite of worldwide trends of favouring higher use of clean energy, Egypt is indicating its commitment to maintain a balance between renewable expansion and continued reliance on fossil fuels.

“This is a message to all of us to work together to increase discoveries and attract more investments through the bids being offered for exploration, aiming to achieve new discoveries in the region, which holds more wealth, particularly natural gas,” Badawi stated during the inaugural session of the Mediterranean Energy Conference 2024.

As Egypt continues to depend on fossil fuels, it is also focused on rebuilding relationships with foreign oil companies. These companies had reduced their operations in the country due to a shortage of hard currency, resulting in Egypt owing billions of dollars.

After assuming the position in July, Badawi has held meetings with several global energy firms, including Italy's Eni, which plans to start drilling additional wells in Egypt's biggest gas field, Zohr, in early 2025 to increase production.

Zohr's gas output reached its highest point at 3.2 billion cubic feet per day in 2019, which allowed the nation to transition into a net exporter. However, production decreased to 1.9 billion cubic feet per day by the beginning of 2024, leading Egypt to ramp up gas imports using a pipeline connected to Israel and LNG deliveries in order to prevent prolonged power cuts.

In September, Egypt's import of high-sulphur fuel oil peaked at 255,000 barrels per day, the highest level seen since at least 2016.