Can Egypt's Crisis Help Clean Energy Gain Traction?

National Geographic MagazineEgypt's political dysfunction has also scuppered a few projects. A planned 200-megawatt solar farm in the south was canceled because the country had no parliament to accept bids for the project, nor any policy that would enable facility operators to make their energy available to the national grid.

Small-Scale Solar Struggles to Compete

More challengingly yet, a history of shoddy, locally manufactured solar water heaters, many of which were sold to farmers in the 1990s, has tarred the industry's reputation in many Egyptians' eyes.

"Using the sun sounds nice, but it's even less reliable than electricity," said Hamid al-Amri, a supermarket manager in central Cairo whose store and apartment are both equipped with traditional water heaters.

Some newspapers appear to have launched a concerted campaign to bolster the image of renewable energy. By one analyst's reckoning, more than 400 articles have sung its praises since this summer, but no amount of publicity can allay concerns over costs.

In 2012, the Ministry of Tourism launched a scheme to outfit 100,000 Red Sea resort hotel rooms with solar water heaters, but two years later, the plan has yet to be properly implemented.

"It's because hotels don't have enough confidence in this new thing," said Emad Hassan, an energy adviser to tourism minister Hisham Zaazou. "They're reluctant to remove their old electric water heaters without assurance that they can recoup their money."

Some hope that a rise in electricity prices will create more of a market for solar water heaters. That would be significant, given that the traditional contraptions are responsible for roughly half of Egyptian households' electricity use, according to SEDA.

So far, the sun-powered devices have been used mostly in big hotels and eco-friendly buildings, because they tend to cost 60 to 70 percent more than electric water heaters, said Mohammed Farid, head of sales at the Cairo-based IMIC engineering firm. "But as electricity gets pricier," Farid said, "the one-off cost of the heater will be offset." His company imports components from Turkey, but he hopes to start manufacturing parts domestically if demand picks up.

It's a similar story in the western desert, where farmers in the distant oases lack access to the national grid and have traditionally relied on diesel-guzzling generators.

Omar Hosny, chief technical officer at KarmSolar, a 3-year-old Cairo-based solar start-up, said he has been swamped with inquiries since this summer. "Farmers are interested, and solar now works out cheaper than diesel, but it's still capital-intensive, so without any financial support, people out here can't afford the up-front costs," he said. The solar equipment is built to last for 25 years, while diesel-powered machinery has a shelf life of less than a decade.

KarmSolar's very existence and ability to attract top young local engineers is a measure of how far Egyptian renewable energy has come, but its projects are small—it operates eight solar-powered water wells, and it's still complicated for the company to work outside of isolated arid spots.

"It doesn't make sense for us to focus on most areas, because subsidies are still too high for solar in places attached to the grid," Hosny said.

Signs of Change

Elsewhere, however, renewable energy appears to be winning itself some powerful advocates.

The military, which occupies an outsize but undefined role in the Egyptian economy and operates a number of large factories, has begun to express an interest in solar technology.

"It's the future for Egypt and the army, and it is our responsibility to take the lead," said a senior official in the Ministry of Defense, who spoke on the condition of anonymity. He voiced a personal interest in equipping army bases with solar panels to make their power supply less vulnerable to attack from outside.

Even more significant is the interest from industry, which consumes most of Egypt's energy. The unreliable natural gas supply has persuaded an Italian cement firm to propose plans for a 120-megawatt wind farm near its plant in southern Egypt.

The stars certainly appear to be aligning in favor of renewable energy. Officials claim that new incentives to boost renewables on the grid will be proposed within weeks, while the prospect of further social unrest if the energy crisis isn't resolved soon appears to have motivated foot-dragging ministers.

It's possible, of course, that this sense of urgency will diminish as temperatures fall below 50°F (10°C) during the winter months, air conditioners are switched off, and energy consumption drops. It's also possible that renewable energy will find itself sidelined once more if new oil and gas deposits are developed in places where small-scale exploration continues.

But with fossil fuel and electricity prices set to increase even more as subsidies are eased, wind and solar might have a window of opportunity. "It is clear that you will have competitive renewable energy in most sectors in just a few years. I have no doubt," said Maged Mahmoud, head of projects and technical affairs for Egypt at the Regional Center for Renewable Energy and Energy Efficiency (RECREEE), a nonprofit organization that advocates for clean energy in Arab countries.

"I see this trend not only in Egypt, but across North Africa and the Middle East. We're seeing dramatic changes," he said.

The story is part of a special series that explores energy issues. For more, visit The Great Energy Challenge.