Egypt’s KarmSolar secures $3 M in debt financing for cutting-edge micro grid system
To support the future development and distribution of Farafra Solar Grid, the company’s second micro-grid-solution, which can handle 100% of clients’ load, KarmSolar, an Egyptian producer and distributor of solar power, has obtained EGP83 million (US $3 million) in loan investment.
KarmSolar seeks to lead the expansion of Egypt’s private solar energy industry by introducing novel and comprehensive solutions for the commercial, agricultural, industrial, and tourism sectors.
Farafra Solar Grid is a first-of-its-kind microgrid solution that uses solar PV panels, battery storage, and diesel generators in a centralised setup, operating under a usufruct agreement, then distributes the generated electricity to the various off-takers. It aims to be fully operational by Q3 2023.
A 3.4 MWp solar PV plant, 3.7 MVA diesel generators, and a 4 MWh/1 MW solar battery storage system will make up the first phase of the Farafra Solar Grid. These components will be installed under KarmSolar’s SPV, Mars for Selling and Distributing Electricity. The project will allow for a solar penetration of around 60%, with the goal of reaching 100% in three years. This will offset a total of about 5,200 tonnes of CO2 emissions per year.
With the assistance of Ezdaher Financial Consultancy, HSBC provided loan finance for the solar grid project in the amount of EGP83 million (US $3 million) for phase one.
“The kickoff of the Farafra Solar Grid enables us to achieve our vision of extending affordable, reliable solar energy to relatively inaccessible parts of the country. It is very refreshing to see institutions like HSBC willing to focus their efforts and trust towards investing in nonconventional projects like the Farafra Solar Grid,” said KarmSolar’s co-founder and CEO Ahmed Zahran.
“HSBC is committed to supporting and financing the transition to secure a net zero future by helping our clients access sustainable and innovative finance solutions across all business sectors so they can make the investments needed to achieve their net zero goals,” said Yasmin Farid, head of small and medium enterprises and business banking at HSBC Bank Egypt.
