Analysis of an Integrated Combined Power Cycle Plant in Egypt

This study examines the investment in the proposed combined power cycle plant in Egypt. Due to rise in population, Egypt is facing a challenge supply of the electricity to the end users. As a result, the demand of electricity in Egypt is very high and it is potentially attractive to invest in the power sector. In order to meet the growing demand for electricity, the Egyptian government is considering to introduce the various projects, which are efficient in terms of cost, as well as, they have a positive impact on the economy. Out of these projects, from the cost and benefit perspective the El Kureimat Combined Power Cycle Plant is a good choice. Furthermore, the proposed plant technology is an alternative to the existing fuel technology plants which are not so fuel efficient, thus, the cost of generating electricity per unit decreases. The proposed plant is powered by natural gas and uses 6th gas and steam turbines. It has a capacity of 750MW electricity. The Gas turbines generate 500MW and the steam one produces 250MW. Different kinds of analyses such as economic, financial and stakeholder analyses are conducted under this research in order to check the impacts of the proposed plant on the economy. Financially and economically this project is viable but it has some issues regarding the repayment of the loan. There are some factors that impose risks to the financial variability of the project caused by such factors as change in interest rate, electricity tariffs, inflation, the rate of inflation, the degree of subsidization of the natural gas and demand tariff on financial viability that have an adverse impact of the proposed project. Possible measures need to be considered in order to decrease the identified risk exposure, as well as to make this project more attractive in future. Keywords: Investment appraisal, financial analysis, economic analysis, stakeholder analysis, risk analysis, power plant, Egypt