Chapter 1 provides an overview of Egypt’s enabling environment for green hydrogen production, examining the economic environment, relevant policies and sectoral factors that influence its investment potential. It explores six core dimensions: the macroeconomic context, financial sector, energy landscape, industrial demand, policy and regulatory frameworks, as well as the current status of low-carbon hydrogen projects. While Egypt has introduced multiple strategies and incentives to position itself as a global green hydrogen hub, significant implementation challenges persist. This chapter underscores that realising Egypt’s green hydrogen ambition will require translating strategic planning into targeted financial solutions and creating enabling investment conditions to make green hydrogen projects more bankable.
Implementing the OECD Framework for Industry’s Net‑Zero Transition in Egypt
Abstract
The Government of Egypt has taken steps to strengthen its role in global climate action. Despite contributing less than 0.6% of global greenhouse gas (GHG) emissions in 2021, Egypt has adopted a reform agenda that includes transforming its energy and industrial systems. This includes the second updated Nationally Determined Contribution (NDC), which sets a target of generating 42% of its electricity from renewable and clean energy sources by 2030, and the National Climate Change Strategy 2050, which outlines priorities for GHG emissions reduction, climate resilience and sustainable economic development (Government of Egypt, 2022[1]; Government of Egypt, 2023[2]).
Low-carbon hydrogen has emerged as a strategic priority within Egypt’s industrial decarbonisation pathway. In September 2022, Egypt established the National Council for Green Hydrogen and its Derivatives (NCGH) to co-ordinate and advance investment in green hydrogen and its derivatives (Ahram Online, 2023[3]). In February 2024, the Supreme Council of Energy approved the National Strategy for Low‑Carbon Hydrogen, a forward-looking plan that seeks to position Egypt as a global leader in the low‑carbon hydrogen economy (State Information Service, 2024[4]). Despite Egypt’s growing ambition in this sector, no project has yet reached final investment decision (FID). However, Egypt has established an enabling legislative and policy framework offering a wide range of incentives to attract investment in green hydrogen and renewable energy. These efforts are reinforced by strengthened bilateral and multilateral co-operation, led by the Ministry of Planning and Economic Development (MPED), in close collaboration with key partners such as the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB) and Scatec, a company based in Norway.
Moreover, the NCGH’s objectives are closely aligned with the overarching goals of the Nexus of Water, Food and Energy (NFWE) Platform (Box 1.2), ensuring coherence between sectoral strategies and the country’s integrated climate and development agenda. Through its focus on investment mobilisation, policy co-ordination and the creation of an enabling environment, the Council actively supports all three NWFE pillars, namely:
Water: by promoting renewable-powered desalination solutions;
Food: by enabling sustainable energy supply chains that lower agricultural production costs and emissions;
Energy: by accelerating the deployment of large-scale renewable energy projects for green hydrogen and ammonia production. Flagship projects include a Green Ammonia Plant in Damietta supporting low-carbon fertiliser production, the Solar-plus-Storage Project and the Nagaa Hammadi Solar Power Plant powering the aluminium complex.
Backed by a consortium of international financiers, the flagship projects conducted under the energy pillar exemplify Egypt’s strategy to integrate renewable energy into industrial decarbonisation, while positioning the country as a competitive hub in the emerging global hydrogen economy.
To support the implementation of Egypt’s National Low-Carbon Hydrogen Strategy, this report applies the OECD Framework for Industry’s Net-Zero Transition (hereinafter “the Framework”) in close collaboration with Egyptian key stakeholders and international development partners (Acknowledgements). Using its step-by-step methodology, the report identifies tailored financial solutions and enabling investment conditions to scale up low-carbon hydrogen production in Egypt. This analysis focuses on bridging the cost-competitiveness gap between green hydrogen (and its derivatives) and fossil fuel-based alternatives, using the price of USD 1.8/kg H2 by 2040 as envisioned in Egypt’s National Low-Carbon Hydrogen Strategy to guide the assessment.1
The report is structured into four chapters, each applying a dedicated methodology to support the identification of financial solutions and enabling investment conditions:
Chapter 1 provides an overview of Egypt’s economic, financial, industrial and energy landscape, alongside relevant policy and regulatory frameworks. These contextual elements help to build comprehensive view to identify barriers and opportunities for developing Egypt’s low-carbon hydrogen sector.
Chapter 2 evaluates the production cost of low-carbon hydrogen and green hydrogen derivatives using techno-economic modelling to assess cost-competitiveness gap against fossil-fuel based counterparts. It estimates the LCOH for low-carbon hydrogen and green hydrogen derivatives under various scenarios and project configurations.
Chapter 3 estimates the cumulative investments required to meet Egypt’s national green hydrogen targets and assesses the effectiveness of selected economic and de-risking instruments in bridging the competitiveness gap with conventional hydrogen.
Chapter 4 builds on the insights from Chapters 2 and 3 and presents identified financial solutions. It also explores ways to improve the enabling investment conditions to improve project bankability and accelerate final investment decisions.
1.2.1. Description of the Framework
The OECD Framework for Industry Net-zero Transition: Developing financial solutions in emerging and developing economies is a step-by-step approach to assist emerging and developing economies to improve the enabling investment conditions and identify financial solutions that can accelerate industry’s transition at a country level, in alignment with climate goals (Figure 1.1). The ultimate objective of the Framework is to create a conducive environment for investment in low-carbon technologies2 and enhance the availability of finance to reduce GHG emissions of the industry sector (OECD, 2022[5]).
The Framework offers a flexible, context-sensitive methodology to support industrial decarbonisation across countries and sectors. Rather than developing comprehensive sectoral roadmaps, it focuses on identifying and enhancing the viability of critical low-carbon technologies through targeted policies and financial instruments. It promotes a holistic strategy encompassing the full value chain, infrastructure development as well as industrial and trade policies. Implemented in collaboration with policymakers, industry actors and financial institutions, the Framework provides each stakeholder group with tailored insights – informing national policies, improving enabling investment conditions for technology deployment and guiding investment priorities to support a just and effective industry transition.
The Framework proposes a five-step approach with an expected implementation of 12 to 24 months (Figure 1.1). Pillar 1 of the Framework encompasses Steps 1 and 2. Its objective is to identify the industry scope/subsector (hereinafter referred to as the “focus area”) and a group of key stakeholders to engage with. The selection is informed by background research and data collection undertaken by the OECD team on socioeconomic, industrial, energy and investment issues that are critical for the decarbonisation of the manufacturing industry (i.e. GDP contribution, employment, energy use, emissions, foreign and domestic direct investment). In Egypt, low-carbon hydrogen has been designated as a focus area at the direct request of the government to support the decarbonisation of hard-to-abate sectors and position the country as a green hydrogen export hub, creating economic opportunities and jobs.
Pillar 2 presents the analytical core of the Framework’s implementation. It consists of Step 3, focused on assessing the business case of low-carbon hydrogen and Step 4, centred on developing solutions for improving the enabling investment conditions and financial solutions to operationalise the selected low‑carbon technology and approaches based on their business cases. Pillar 3, which involves Step 5, revolves around the dissemination of the Framework’s outcomes through outreach activities to help stakeholders gain insights about the benefits of the Framework for industry transition. Annex E provides some insights into the methodology behind each step of the analysis, as well as the stakeholder engagement process supporting the Framework’s implementation.
Source: (OECD, 2022[5]).
1.2.2. Proposal approval
The Arab Republic of Egypt and the OECD have agreed to implement a project under the Clean Energy Finance and Investment Mobilisation (CEFIM) Programme. This project falls under Pillar 5 on Sustainable Development within the Egypt-OECD Programme, inaugurated in 2021 (OECD, 2024[6]; OECD, 2023[7]). The objective is to support the Government of Egypt in mobilising clean energy investment and advancing economy-wide decarbonisation activities to help the country achieve its clean energy transition aligned with its NDC and Egypt’s Updated Vision 2030 (Government of Egypt, 2023[2]; Government of Egypt, 2024[8]). More specifically, the Ministry of Electricity and Renewable Energy (MoERE) and the OECD have agreed to support the operationalisation of this potential through implementation of the OECD Framework.3
The project proposal was approved in October 2023, following a cross-ministerial meeting in June 2023 that included representatives from MoERE, the Ministry of Petroleum and Mineral Resources (MoPMR), the Ministry of Planning and Economic Development (MPED), the Ministry of Industry (MoI), the Industrial Development Authority (IDA), the Suez Canal Economic Zone (SCZone) and the Egyptian Electricity Transmission Company (EETC). To avoid duplicating efforts in green hydrogen initiatives in Egypt, it was agreed that the Framework implementation would be conducted in close co-operation with the United Nations Industrial Development Organization (UNIDO) which undertook green hydrogen production potential feasibility study and on skills gap assessment throughout green hydrogen production value chain (UNIDO, 2023[9]).
1.2.3. Implementation timeline and scope
Effective governance is crucial for the successful implementation of the Framework. It was initially planned to set up a Steering Committee to co-ordinate the activities of the Framework’s stakeholder groups, provide guidance and monitor the progress of its implementation, with the committee making final decisions when necessary. However, to avoid duplication, it was decided that the Framework’s implementation would be overseen by Egypt’s existing Green Hydrogen Technical Advisory Executive Committee, established under the Prime Minister’s Office (Box 1.1). The Framework’s implementation plan and scope were presented to the Committee in January 2024. Following consultations, MoERE was nominated to provide technical guidance for the Framework’s implementation while MPED plays a key role as national co-ordinator of the Egypt-OECD Country Programme. In addition, NCGH, MoPMR and MoI provided valuable inputs during the finalisation of the report, contributing to the alignment of the Framework with Egypt’s broader industrial and energy strategies.
Egypt’s Green Hydrogen Technical Advisory Executive Committee was established in 2023 under the auspices of the National Council for Green Hydrogen and its Derivatives, chaired by the Prime Minister. It serves as the national co-ordinator for all aspects of the green hydrogen sector, ensuring strategic alignment across ministries, overseeing land allocation and facilitating investment partnerships.
Four key government bodies are at the forefront of Egypt’s green hydrogen development, each playing a distinct and strategic role:
The New and Renewable Energy Authority (NREA) is responsible for granting land for renewable energy infrastructure development. It manages applications for green hydrogen project proposals and conducts pre-feasibility studies. NREA charges an annual land use fee of 2% of the renewable energy production revenue, aligning with existing Build-Own-Operate (BOO) projects in operation.
The Egyptian Electricity Transmission (EETC) is responsible for providing transmission services across the national grid. It acts as the sole buyer of electricity generated in Egypt and takes a flat wheeling fee4 on electricity revenue for grid integration. This fee has raised concerns among developers about the increased costs of green hydrogen production, as electricity generation accounts for approximately 70% of total hydrogen production costs. However, for green hydrogen projects – typically structured as private-to-private ventures – a policy decision has been made requiring developers to construct and operate their own transmission infrastructure. This applies specifically to the transfer of renewable electricity from the generation site to the hydrogen production facility and reflects the distinct nature of these projects outside the scope of public grid planning.
The General Authority of Suez Canal Economic Zone (SCZone) manages and regulates green hydrogen facilities, most of which are located within the SCZone. It supports prospective investors by providing necessary administrative services and infrastructure support.
The Sovereign Fund of Egypt (TSFE) co-ordinates all parties involved in green hydrogen projects. Established in 2018 with total assets of USD 2.42 billion, TSFE works closely with the Egyptian government to manage investment deals related to state-owned assets. It participates in green hydrogen projects as an equity partner and provides support for signing green hydrogen memorandums of understanding.
Complementing this co-ordination, Egypt has enacted Law No. 2 of 2024, establishing a robust regulatory and incentive framework that includes tax exemptions, fast-track licensing and local content requirements to attract foreign investment and support sustainable development in the hydrogen sector.
Egypt is a fast-growing emerging economy with a strategic geographic location, serving as a key regional hub linking Africa, the Middle East and Europe. Home to over 110 million people and experiencing steady population growth, Egypt’s large domestic market presents both opportunities and structural challenges. The economy is characterised by a diverse structure, with significant contributions from the industry, services and agriculture sectors. In recent years, Egypt has pursued ambitious reforms to enhance macroeconomic stability, attract foreign investment and promote private sector development. However, it continues to face persistent socio-economic pressures, including high inflation, external financial needs and the need for inclusive and sustainable growth to absorb a rapidly expanding labour force (World Bank, 2023[12]; OECD, 2024[13]).
1.3.1. Macroeconomic conditions
Over the past decade, Egypt’s economy has experienced rapid growth, supported by government efforts to enhance macroeconomic stability. Egypt’s gross domestic product (GDP) grew by 3.5% in 2024, reaching Egyptian Pound (EGP) 13.3 trillion (equivalent to United States dollars [USD] 261.3 billion).5 Despite continued economic expansion, Egypt’s growth rate remains below the 4.3% average projected for Organization of the Petroleum Exporting Countries (OPEC), reflecting persistent structural and macroeconomic challenges.
Inflation remained high at 24%, though it has declined from its peak in 2022. This moderation was partly driven by lower electricity and fuel prices, alongside a cumulative 1 900 basis-point increase in the Central Bank of Egypt’s policy interest rate between March 2022 and March 2024 (Trading Economics, n.d.[14]; Ahram Online, 2024[15]). The EGP appreciated by 10 percentage points against the USD in the first quarter of fiscal year (FY) 2024/25 after successive years of devaluation (Ministry of Planning, Economic Development and International Cooperation, 2024[16]; World Food Programme, 2025[17]). Foreign exchange reserves rose to EGP 2.1 trillion (USD 47 billion) in October 2024, supported by ongoing financial assistance from the International Monetary Fund (IMF) (Egyptian National Competitiveness Council, n.d.[18]; EBRD, 2023[19]; Central Bank of Egypt, 2023[20]; IMF, 2024[21]). In March 2025, the IMF completed the fourth review of Egypt’s Extended Fund Facility (EFF), enabling a disbursement of USD 1.2 billion to support economic reforms and macroeconomic stability. Concurrently, the IMF approved a new USD 1.3 billion arrangement under the Resilience and Sustainability Facility (RSF) to further bolster Egypt’s reserves and advance its broader reform agenda (IMF, 2025[22]).
Egypt’s elevated country risk – reflected in its “highly speculative” sovereign credit rating – continues to deter capital inflows and raise the financing costs for infrastructure projects. In 2024, the US Sovereign Rating Action Moody’s downgraded Egypt’s rating to Caa1 from B3 (Moody's Rating, 2024[23]).6 Moreover, Egypt was excluded from J.P. Morgan’s GBI-EM index, citing fiscal imbalances, currency volatility and inflation risks. Despite efforts to stabilise capital markets, such as the introduction of a 20-year benchmark yield curve, government bond yields remain high, with the 10-year bond reaching 24.5% as of January 2025. This underscores the urgency of improving Egypt’s investment environment to unlock funding for large-scale low-carbon infrastructure projects, including green hydrogen.
Despite progress in recent years, Egypt continues to grapple with a complex and persistent debt crisis and outstanding structural reform needs. The country faces significant refinancing needs, with 17% of its public debt (EGP 1.3 trillion or USD 26 billion) maturing within a year (Central Bank of Egypt, 2024[24]). In 2022, external debt accounted for 35% of the country’s GDP. However, government and IMF-led reforms have reduced Egypt’s debt to 89% of GDP in 2024, targeting to reach below 80%-levels by FY 2025/26 (State Information Service, 2024[25]). The fiscal deficit also declined to 3.6% of GDP in FY 2023/24 and is expected to decrease further, driven by higher tax revenues, expenditure controls, enhanced debt management, diversification of financing sources, adherence to investment ceilings and the privatisation of large state‑owned enterprises (SOEs) (Zawya, 2024[26]; Zawya, 2025[27]; The Middle East Observer, 2025[28]).7 Egypt has also strengthened international partnerships to fund climate action, job creation and green energy initiatives. For instance, in 2023, Germany signed a debt swap agreement8 with Egypt worth EGP 2.8 billion (USD 89.6 million) to support Egypt’s clean energy transition (German Embassy Cairo, 2023[29]) within the NWFE Platform (Box 1.2).
Launched in 2022, within the framework of Egypt’s COP27 Presidency, the Nexus of Water, Food and Energy (NWFE) Programme plays a pivotal role in advancing the implementation of Egypt’s National Climate Change Strategy 2050 and its NDC. The NWFE Programme, which is the Arabic translation of the phrase “Fulfilling Pledges”, serves as a strategic co-ordination mechanism to mobilise climate finance and foster strategic partnerships across the water, food and energy sectors. It identifies policy reforms, supports the design, structure and preparation of climate projects, leverages technical co-operation and mobilises financing with instruments such as debt swaps, guarantees, concessional loans, grants and private investments. The NWFE Programme translates these strategies into actionable projects across the three interconnected pillars and the extended NWFE+ for sustainable transport.
The energy pillar, supported by the European Bank for Reconstruction and Development (EBRD), is a critical component of delivering Egypt’s energy-specific NDC goals. Specifically, it aims at decommissioning 5 gigawatt (GW) of inefficient oil and gas power plants, mobilising USD 10 billion to develop an additional 10 GW of renewable energy capacity by 2028 and upgrading and expanding the transmission network to enhance grid resilience and integration. The energy pillar leverages innovative financing mechanisms to accelerate the transition to renewable energy and reduce CO2 emissions. These mechanisms include blended finance, concessional financing, debt swaps and facilitation of private sector investment. The approach aims to mobilise both concessional and commercial capital for priority projects such as renewable energy generation and transmission grid enhancement. In addition, a dedicated grants platform is being activated to channel funding toward projects identified under the energy pillar, further supporting implementation and impact.
Between 2022 and 2024, NFWE made major strides in attracting international pledges. Under the first pillar (“Replacing inefficient thermal power plants with renewable energy”) about 1.1 GW of thermal power plants were decommissioned. For the second pillar (“investments in renewable energy”), NWFE mobilised USD 4 billion in development financing to establish seven renewable energy projects totalling 4.2 GW, with further projects expected in 2025 to add 3.4 GW. Under the third pillar (“transmission network investment”), the Platform secured USD 1.2 billion in development financing, primarily from international public sources such as bilateral development partners (e.g. France, Germany) or investment banks (e.g. European Investment Bank (EIB), EBRD). Technical assistance has also been provided by the EBRD and other development partners through three support programmes aimed at strengthening green supply chains and renewable energy developments, improving the electric network and promoting a just energy transition. Additional to the pillars, Egypt attracted a USD 10 billion investment from the Norwegian company Scatec for green hydrogen projects and now hosts 33 green hydrogen development projects.
Source: (Government of Egypt, 2025[30]).
1.3.2. Egypt’s financial sector
A mature domestic financial sector is critical to mobilising long-term capital for renewable energy and green hydrogen, given their high upfront costs and extended payback periods. Egypt’s financial system remains dominated by the banking sector, which accounts for 92% of total financial assets – equivalent to 117% of GDP by end 2023. In contrast, the non-bank financial sector – an important source of capital for green investments globally – remains underdeveloped, representing only 10% of GDP (Central Bank of Egypt, 2024[31]). Limited local lending capacity can hinder project bankability and over-reliance on foreign currency loans increases exposure to exchange rate volatility. While the Central Bank’s Financial Stability Index improved from 0.34 to 0.44 between March 2023 and March 2024, structural challenges persist (Central Bank of Egypt, 2024[31]; Central Bank of Egypt, 2024[32]). The persistently low loan-to-deposit ratio indicates a structural underutilisation of available capital for infrastructure projects, including green hydrogen (Mohieldin, 2019[33]).
To diversify capital sources and enhance investor confidence, Egypt is strengthening its non-bank financial sector while enhancing its overall investment climate. These reforms contributed to a 12% increase in FDI inflows between 2022 and 2023, from EGP 166 billion (USD 8.9 billion) to EGP 190 billion (USD 10 billion) (UNCTAD, 2024[34]). Egypt is also working towards deepening integration with global financial markets; improved access to international clearing systems like Euroclear or Clearstream could attract more cross‑border investment.
Egypt is scaling efforts to mobilise sustainable finance to invest in low-carbon technologies such as green hydrogen and renewables. A cornerstone of this strategy is the Green Financing Framework, launched in 2020, and the issuance of Egypt’s first sovereign Green Bond valued at EGP 38 billion (USD 750 million) of 5.25% interest rate over five years. It aims to channel capital into low-carbon projects including renewable energy, clean transportation and sustainable water (Ministry of Finance, 2021[35]). This milestone set a precedent for the private sector, leading to Egypt’s sustainable bond market reaching EGP 55 billion (USD 1.1 billion) in 2023 (Climate Bonds Initiative, n.d.[36]). In late 2024, Egypt received EGP 25.3 billion (USD 500 million) sustainability bond, backed by the International Finance Corporation, the EBRD and British International Investment to advance Egypt’s green transition (IFC, 2024[37]). Additionally, Samurai and Panda bonds,9 first issued in FY 2022/23, contributed to support industry decarbonisation, by offering competitive pricing and lower borrowing costs making it more feasible for the government and businesses to invest in green industrial initiatives, and allowing industries to benefit from cheaper financing to adopt low-carbon technologies (O'Bang Law, 2024[38]). The government plans to issue new sukuk10 and green bonds worth EGP 5-10 billion (USD 100-200 million) by the end of FY 2024/25 (State Information Service, 2024[39]).
Complementing these efforts, the Sovereign Fund of Egypt (TSFE) lays a strategic role in de-risking investments, co-financing flagship hydrogen ventures and facilitating blended finance mechanisms that attract both domestic and international capital. These combined efforts are crucial for building a resilient financial ecosystem to support Egypt’s green hydrogen development and illustrate the country’s ongoing commitment to strengthening local financing mechanisms for low-carbon technologies.
Building on this momentum, Egypt launched Africa’s first Voluntary Carbon Market (VCM) in August 2024 to further mobilise capital for its green transition (Shehata and Partners, 2024[40]; Delegation of the European Union to Egypt, 2024[41]). The VCM aims to increase exposure and engagement of the private sector towards emission reduction initiatives in Egypt and establish a framework for international co‑operation moving forward. Within less than a year, Egypt has completed four initial transactions amounting to 4 850 carbon credits. While modest in scale, this early activity reflects positive momentum.
1.3.3. Egypt’s energy landscape
Renewable energy accounted for a small share of Egypt’s total final energy consumption, despite the country’s abundant renewable resources. In 2022, renewable energy made up about 12% in total electricity generation and the total installed renewable energy generation capacity (6.2 GW) represented about 20% of its peak load (31 GW), mainly coming from hydropower, wind and solar. By 2023, Egypt had installed an additional 6.7 GW of renewable capacity, led by hydropower (2.8 GW), wind (1.9 GW) and solar (1.8 GW). Despite steady growth in absolute terms and the resource potential the country offers, renewables have not expanded fast enough to meet rising electricity demand. Instead, natural gas has increasingly filled the gap in electricity generation, reinforcing Egypt’s dependence on fossil fuels (IRENA, 2025[42]).
Egypt’s energy mix remains heavily dominated by natural gas and oil, accounting for 50% and 40% of primary energy consumption, respectively, in 2022 (IEA, 2025[43]). The country ranked as the third-largest natural gas producer in Africa, after Algeria and Nigeria, driven by significant offshore natural gas discoveries in the mid-2010s (Nour Moharram, 2022[44]). Egypt is also a significant oil producer, although its output remains modest compared to Africa’s top producers Nigeria, Algeria, Angola and Libya (OECD, 2024[45]). In 2023, the country ranked as the second-largest non-member of the Organisation of Petroleum Exporting Countries (OPEC) producer of total liquid fuels on the continent, with an annual output of 32 million tonnes of oil equivalent (Mtoe).
Despite strong domestic production, Egypt remains a major gas importer, reflecting growing supply‑demand imbalances. Between 2000 and 2022, natural gas consumption rose by 264%, driven by abundant availability (through both domestic production and imports), operational flexibility and comparatively lower CO2 emission intensity of gas (IEA, 2025[43]). This expansion was further accelerated by rapid population growth and economic development, which intensified pressure on electricity generation. While 47% of domestically produced natural gas is exported, only 43% is consumed locally. In 2024, Egypt imported 14.6 billion cubic meters (bcm) of liquefied natural gas (LNG) and pipeline gas (Business Today Egypt, 2025[46]; IEA, 2025[43]). Meanwhile, declining crude oil output has led to further reliance on gas imports.
Egypt’s reliance on fossil fuels has significant implications for its emissions profile. In 2022, the country emitted an estimated 240 Mt of CO2, accounting for roughly 15% of the continent’s total CO2 emissions. Per capita CO2 emissions stood at 1.9 tonnes in 2021, exceeding the African average of 1.2 tonnes but remaining well below the OECD average of 8.4 tonnes (IEA, 2025[43]). The electricity sector is the single largest contributor to Egypt’s emissions profile, responsible for 40% of the country’s total fossil fuel related CO2 emissions. Electricity demand has been growing at an average annual rate of 1.5% since 2022 and is projected to rise by around 2% per year through 2026, driven by population growth and expanding industrial activity (IEA, 2024[47]). Industry was the third-largest CO2 emitter in Egypt, after electricity and transportation, contributing approximately 11% of Egypt’s total emissions (27 Mt CO2) (Figure 1.2, panel B) (CAPMAS, 2024[48]). These trends underscore the need to accelerate renewable energy deployment and decarbonise both the electricity and industrial sectors to meet Egypt’s climate and energy security goals.
Note: CO2: carbon dioxide; RE: renewable energy; solar PV: solar photovoltaic.
In response to these challenges, Egypt has taken steps to reform its energy sector and improve efficiency. Between 2014 and 2019, the government implemented far-reaching energy subsidy reforms, significantly raising domestic fuel prices (WRI, 2021[51]; OECD, 2024[45]). Since then, a fuel price adjustment mechanism has been in place, helping reduce energy subsidies to 5-7% of GDP in recent years (Economic Research Forum, 2025[52]; Fossil Fuel Subsidy Tracker, n.d.[53]; World Bank, 2024[54]). Egypt is also working towards decarbonising its oil and gas sector, notably through the Petroleum Sector Energy Efficiency Strategy 2022-2035, which targets a 10% reduction in energy consumption by 2027 and 18% by 2035 (Ministry of Petroleum and Mineral Resources, n.d.[55]; Egypt Energy Show, 2024[56]). The country has also pledged to reduce methane emissions from flaring by 65% by 2030, compared to 2015 levels. Over 30 flare gas recovery projects are already in progress to support this commitment.
Egypt is actively pursuing FDI in renewable energy to accelerate deployment and reduce fossil fuel reliance. Between 2015 and 2022, the country attracted over USD 45 billion in FDI for renewable energy projects, placing it among the top ten developing economies globally in this area (OECD, 2024[45]). Nonetheless, the relatively high cost of capital reflects prevailing investment risks such as macroeconomic volatility, policy uncertainty and constrained access to concessional finance (IRENA, 2023[57]).
Egypt is also prioritising the decarbonisation of its industrial sector, which is a key driver of high fossil fuel consumption. As the third-largest energy consuming sector after electricity generation and transportation, industry accounts for 26% of Egypt’s final energy consumption Figure 1.3, Panel A). Egypt’s non-metallic minerals (cement, bricks, etc.) account for 42%, iron and steel for 22%, and chemicals (including fertilisers and ammonia) for around 15-18% of total final industry energy consumption, also driving high demand for fossil fuels (IEA, 2024[49]). Oil is the primary energy source in industry (41%), followed by electricity (28%), gas (27%) and coal (10%) (Figure 1.3, Panel B). This explains why fossil fuels remain deeply embedded in Egypt’s energy system, including for industrial uses as fuel and feedstock.
Note: In Panel A, renewable energy share in total final energy consumption (RE TEC). Information is extracted from annual reports 2007-08, 2013-14, 2017-18 and 2021-22. In Panel B, electricity refers to gross electricity production measured at the terminals of all alternators sets in a station, including conventional thermal, hydro, geothermal and solar stations. Electricity generation in hydropower plants includes output from pumped-hydrogen storage plants.
1.3.4. Egypt’s industry sector
In 2024, Egypt’s industry11 emerged as the largest contributor to the country’s GDP, accounting for 16% (EGP 1.9 trillion or USD 38 billion), surpassing other key sectors such as wholesale and retail (14%), agriculture (11%) and real estate (10%) (Invest in Egypt, 2024[59]). The growth of Egypt’s industrial sector is largely driven by steel, fertilisers and petrochemicals. The sector also played a crucial role in Egypt’s trade landscape, contributing to half of the country’s total exports in 2022, amounting to EGP 63.5 billion (USD 25.9 billion) (UNIDO, 2023[9]).
In 2019, Egypt produced approximately 1.8 Mt of grey hydrogen from natural gas via steam methane reforming (SMR), a carbon-intensive process emitting 8-10 kg CO2/kg H2 (IEA, 2024[60]; The Oxford Institute for Energy Studies, 2021[61]). In 2022, energy-intensive industries – such as fertilisers, petrochemicals and refineries – were the main hydrogen consumers, accounting for 36% of Egypt’s natural gas use (IEA, 2025[43]). Egypt’s dependence on natural gas in these energy-intensive industries resulted in 36 Mt of CO2 emissions, accounting for 16% of the country’s total. Of this, hydrogen production alone was responsible for 17 Mt CO2, or 6% of national emissions (UNIDO, 2023[9]). Replacing grey hydrogen with green hydrogen in hydrogen consuming sectors could reduce process-related emissions (IEA, 2023[62]). These savings reflect the potential to avoid nearly all CO2 emissions from natural gas-based hydrogen production, while harnessing Egypt’s abundant solar and wind resources to scale up renewable electricity generation (UNIDO, 2023[9]; Hydrogen Europe, 2024[63]). Technical pathways for decarbonising Egypt’s industry using green hydrogen are discussed in Chapter 2.
The global emergence of carbon border measures, such as the EU Carbon Border Adjustment Mechanism (EU CBAM), is intensifying the urgency of industry decarbonisation and the transition to green hydrogen. For major exporters like Egypt, particularly in sectors like steel, fertilisers and petrochemicals, EU CBAM measures could pose competitiveness risks in markets that favour, low-emission production. Green hydrogen offers a strategic pathway to mitigate these trade risks, enhance access to carbon-sensitive markets and position Egypt as a competitive supplier as regional markets develop (Box 1.3).
In parallel, Egypt has advanced its industrial decarbonisation agenda through institutional and regulatory reforms aligned with CBAM requirements. The Egyptian Accreditation Council (EGAC) became the first Arab and African body recognised by European Accreditation, accrediting several national Validation and Verification Bodies (e.g. GOEIC, EOS, EOL, TUV Nord). In late 2024, high-level decrees established a Ministerial Committee and a National Executive Secretariat involving 30 stakeholders to co-ordinate CBAM and decarbonisation efforts. A National Action Plan was endorsed, structured around 13 pivots covering Scope 1, 2 and 3 emissions. Sectoral action plans for steel, cement, aluminium and fertilisers are currently under development in collaboration with Egypt’s Information and Decision Support Centre (IDSC) and the MoE.
The European Union’s Carbon Border Adjustment Mechanism (EU CBAM), scheduled to enter into force as of 2026, is a climate policy instrument established to prevent carbon leakage and support global decarbonisation efforts. It functions by placing a carbon price on imports of certain carbon‑intensive goods from countries with less stringent climate policies. The CBAM aims to ensure that the price of embedded carbon in imported products is equivalent to that of products produced within the EU under the EU Emissions Trading System (EU ETS), thereby maintaining a level playing field.
Egypt is particularly vulnerable to the impacts of EU CBAM, as exports to the EU constitute 38% of its total domestic exports. Given the high energy and emissions intensity of Egypt’s industrial sector, key exports, including cement, iron, steel, aluminium, fertilisers, electricity and hydrogen, will be directly impacted by EU CBAM. According to the World Bank’s CBAM Exposure Index, Egypt ranks among the most exposed countries to this policy, facing an additional cost of EGP 111 (USD 2.2) per tonne of CO2 to access the European market. For example, in 2022, Egypt exported an estimated 560 000 tonnes of steel to the European market. Assuming an emissions intensity of 2 tonnes of CO2 per tonne of steel – a common estimate for conventional production – this could result in an extra cost of over USD 2.4 million.
Starting in January 2027, the United Kingdom will implement its own Carbon Border Adjustment Mechanism (UK CBAM), covering the aluminium, cement, fertiliser, hydrogen, iron and steel. Egypt’s exporters will need to account for the carbon emissions embedded in their products. If these emissions exceed UK benchmarks or if Egypt lacks an explicit carbon pricing mechanism, importers may face additional charges, potentially affecting the competitiveness of Egyptian goods in the UK market.
1.3.5. Country strategy, policies and mechanisms
Key national strategy and development plans
In its first updated NDC of 2022, Egypt established several emissions reduction targets at sector level to be realised by 2030, as compared to business-as-usual (BAU) scenario. This includes the electricity sector (a 33% reduction relative to BAU, equalling 70 Mt CO2-equivalent (CO2-eq) per year), the transport sector (7% or 9 Mt CO2-eq relative to BAU) and the oil and gas sector (65% relative to BAU, equalling 1.7 Mt CO2‑eq). However, it is important to note that these reductions are relative to a projected increase in emissions under the BAU scenario. This means that, in absolute terms, emissions in these sectors are still expected to rise compared to current levels.
In its second updated NDC of 2023, Egypt committed to achieving 42% of clean energy in its electricity mix by 2030 (five years earlier than the previous NDC target) and a GHG emission reduction target in the power sector of up to 37% relative to BAU. These targets are conditional to securing international financing, which is estimated at EGP 9 trillion (USD 196 billion) for climate change mitigation and EGP 2.3 trillion (USD 50 billion) for adaptation measures (Government of Egypt, 2023[2]). Yet, it is key for Egypt to update its sectoral strategies, such as the National Strategy for Sustainable Agriculture and the Integrated Energy Plan, to ensure an alignment with the latest NDC targets (OECD, Forthcoming[68]). The relevant sectoral strategies are listed in Table 1.1.
Source: Information provided by the Government of Egypt.
Renewable energy and electricity sector policies
The NREA works as the national focal point for the development and implementation of renewable energy projects. It supervises the implementation of the Integrated Sustainable Energy Strategy (ISES) 2035 and the updated energy targets of the NDC, which aim to reach 42% of electricity generation from clean and renewable energy sources by 2030, reduce oil and gas production, phase out coal and install 4-5 GW of nuclear energy capacity by 2030 (Government of Egypt, 2016[79]; Government of Egypt, 2023[2]).
Mechanisms supporting this transition include two Feed-in Tariff (FiT) schemes launched in 2014 and 2016, targeting 2.3 GW of solar PV and 2 GW of wind capacity, with key projects such as the Benban Solar Park, the world’s largest solar photovoltaic parks or the Zafarana site for solar and wind power. Between 2014 and 2019, FiTs facilitated 1.47 GW of solar installations. After the FiT successfully attracted private sector participation, the electricity sector transitioned to Build-Own-Operate (BOO) models and competitive auctions. These mechanisms offered greater flexibility in accommodating renewable technology costs and opened up new investment opportunities (Res4Africa, 2018[80]). Egypt’s first renewable Independent Power Producers (IPP) scheme, the Ras Ghareb Wind Farm, became operational in 2019. It marked a major milestone in Egypt’s energy transition and private sector participation in renewable energy. Phase 1 has a total installed capacity of 500 MW. In the case of auctions, embraced by Egypt’s Renewable Energy Law No. 203 of 2014, competitive bidding mechanisms were introduced to diverse financing options and attract private investment. Early auctions focused on solar PV and wind projects under Engineering, Procurement and Construction (EPC)12 or BOO13 models, with IPPs selling power under Power Purchase Agreements (PPAs) with the EETC. In response to evolving market needs, EETC, with EBRD support, is actively redefining its auction processes to enhance procurement frameworks for renewable energy projects (PV Magazine, 2018[81]).
The IPP scheme allows private producers to sell electricity directly to consumers through bilateral contracts or the wheeling scheme, using public transmission grids for a fee. This model reduces upfront public investment needs while increasing competition and ensuring continuous private-sector involvement. In addition, a shift towards smart and cost-reflective pricing would be more efficient than Egypt’s current flat wheeling fee. A more dynamic approach – combining distance-based fees and time-of-use discounts – would better align grid usage with actual costs and system needs. Projects located closer to grid nodes could benefit from lower fees (e.g. within 50 km of Suez industrial zones), encouraging strategic siting and reducing transmission losses. Meanwhile, offering discounted wheeling rates during off-peak periods would incentivize generation when the grid can absorb it, supporting system flexibility and renewable integration. In parallel, self-gridding incentives could allow developers to build private transmission corridors (e.g. 10 km lines) for direct renewable-to-electrolyser supply, exempt from wheeling fees, thereby unlocking investment in green hydrogen and industrial decarbonisation. These reforms would enhance investment signals, improve grid efficiency, and support Egypt’s clean energy transition (Denis, 2026[82]).
The Golden License, along with Egypt’s NWFE platform, is also a key mechanism to attract private capital in low-carbon infrastructure.14 Since its introduction in 2022, the Golden License has contributed to a 6% increase in renewable energy capacity between 2022 and 2023 amounting to 6.7 GW (Minstère de l'Économie, des finances et de la souveraineté industrielle et numérique, 2022[83]; IRENA, 2024[84])). Securing Golden Licenses has helped a USD 850 million solar project by AMEA Power and a 1.1 GW Suez Wind Project of USD 1.1 billion by the African Development Bank. It contributed to avoiding lengthy and cumbersome processes of obtaining individual permits for construction, operation, land use, and grid connection, significantly accelerating the timeline of each project (Vasileva, 2024[85]; African Development Bank, 2024[86]).
Additional regulatory frameworks include the Green Bond Guidelines (2018), the Environmental Sustainability Criteria Guidelines (2021), the Guiding Principles on Sustainable Finance issued by the Central Bank of Egypt (2021) and Decrees 107 and 108 (2021), which require companies to submit environmental, social and governance (ESG) reports (Ministry of Planning and Economic Development, 2021[87]; Central Bank of Egypt, n.d.[88]).
The National Strategy for Low-Carbon Hydrogen (Arab Republic of Egypt, 2024[89]), announced at the 27th Conference of Parties to the United Nations Framework Convention on Climate Change (COP27), was approved in 2024 by the Supreme Energy Council (SEC) in collaboration with the EBRD and the Arab Union for Sustainable Development and Environment (AUSDE). The strategy is designed to harness Egypt’s competitive potential in green hydrogen production, aiming to secure 5-8% of the global market by 2040 – equivalent to approximately 6.5 Mt annual production of green hydrogen – while requiring an estimated USD 60 billion in investment. The strategy estimated that green hydrogen production will boost Egypt’s GDP by USD 18 billion and generate over 100 000 jobs by 2040.
This ambition is underpinned by Egypt’s significant potential to develop green hydrogen, supported by its abundant renewable energy resources and strategic geographic location (UNIDO, 2023[9]). The country’s annual electricity generation potential includes approximately 73 700 terawatt hours (TWh) from concentrated solar power (CSP), 7 650 TWh/year from wind, 36 TWh/year from photovoltaic (PV), 15 TWh/year from bioenergy, 26 TWh/year from geothermal and 80 TWh/year from hydropower (Salma Salah, et al., 2022[90]). Egypt’s geographic location between the Mediterranean and Red Sea positions the country as a key global hub for shipping and hydrogen trade (Oxford Institute For Energy Studies, 2021[91]).
Egypt’s established ammonia industry and extensive gas infrastructure provide a strong foundation for scaling up green hydrogen production. As Africa’s largest ammonia producer, with an output of around 6 Mt annually, Egypt is well-positioned to convert and store green hydrogen in the form of green ammonia – the most cost-effective and scalable liquid hydrogen carrier currently available (Rouwenhorst, 2022[92]). In parallel, the country’s vast gas pipeline network – comprising 60 000 km of distribution and 7 500 km of transmission lines – could be partially repurposed or leveraged in the future to support domestic hydrogen transport and blending (Salma Salah, et al., 2022[90]).
Translating this potential into export leadership requires overcoming significant infrastructure and investment challenges. Advanced technologies for hydrogen production and conversion remain underutilised due to limited investment across the hydrogen value chain, including in conversion, storage and export capacity (Hassan and El-Amary, 2025[93]). A key constraint is the absence of direct hydrogen‑compatible pipeline infrastructure to Europe. Combined with high transport and logistics costs, this continues to restrict Egypt’s export competitiveness. Thus, substantial investment will be required in dedicated infrastructure for the large-scale transport, conversion, as well as export of hydrogen and its derivatives to fully capitalise on international market opportunities.
Egypt’s high perceived country risk remains a key barrier to scaling green hydrogen. Closely tied to sovereign credit risk, country risk significantly increases financing costs in emerging markets and developing economies (Lee and Saygin, 2023[94]). In January 2025, Egypt’s country risk premium stood at 10% (Damodaran, 2025[95]), reflecting investor concerns over macroeconomic stability and directly driving up the cost of capital, thereby undermining the competitiveness of green hydrogen production in Egypt. Therefore, any strategy to accelerate Egypt’s low-carbon hydrogen deployment must tackle underlying macroeconomic risks that contribute to this elevated risk premium.
1.4.1. Egypt’s green hydrogen project landscape
As of June 2024, Egypt signed 32 Memoranda of Understanding for green hydrogen projects worth around USD 175 billion (GH2, 2024[96]). Most green hydrogen projects are situated in the Suez Canal Zone (SCZone) due to its strategic location near key manufacturing hubs, export terminals and ammonia production facilities, making it an ideal site for integrated hydrogen-ammonia value chains (Figure 1.4). In addition, the SCZone qualifies for various investment incentives such as the one under Investment Law No. 72 of 2017, including a 50% tax deduction on eligible costs, reinforcing its position as Egypt’s strategic hub for low-carbon industrial development (Table 1.2).
Note: The map does not reflect Egypt’s full territory and is used solely to illustrate the locations of projects. It uses the administrative divisions of Egypt’s governorates, sourced from Egypt’s Central Agency for Public Mobilization and Statistics (CAPMAS). The information presented in this map is extracted from publicly available sources. Data is subject to limitations due to incomplete or partial sources. For instance, it excludes projects which have not disclosed their geographic location. The large majority of projects are planned for implementation in the Suez Canal Economic Zone, with many concentrated in Ain Sokhna. While some projects are designed for export markets, others aim to supply low-carbon hydrogen and its derivatives to the domestic market. Some projects are designed to be implemented in multiple phases, with full production capacity expected to be reached by 2030 and beyond.
Source: Data from (IEA, 2025[97]). Unless otherwise specified, all production figures are reported as annual outputs.
Egypt established a legal and regulatory framework to support the implementation of its National Low‑Carbon Hydrogen Strategy. This includes several cabinet decrees (No. 20, 981 and 983), Law No. 2 of 2024 and a range of incentive policies and measures. Notably, the Green Hydrogen Incentives Law introduces a comprehensive package of fiscal and non-fiscal incentives designed to accelerate project development and reinforce the green hydrogen value chain (OECD, 2024[98]).
Egypt does not yet provide local regulations and certification to verify the origin and quality of low-carbon hydrogen. Thereby, projects are still governed by the existing Gas Market Law No. 196 of 2017. Nevertheless, Egypt is making strides to align its hydrogen accreditation framework with European market standards, but both sides are still navigating fragmented and evolving discussions. On the European side, standard-setting is a work in progress, and Egypt must strategically position itself to engage with these developments. While the 2022 EU-Egypt MoU laid the groundwork for co-operation, Egypt’s current system lacks a unified, independent certification methodology that meets EU criteria for carbon intensity, traceability and guarantees of origin. Emphasising the importance of certification systems is critical, and Egypt would benefit from developing a fair, internationally compatible framework to ensure future market access and credibility. Connecting relevant sections of the strategy to these international processes could strengthen alignment and signal readiness to meet global standards.
Note: The investment incentives applied to SCZone also applies to other zones, namely: ii) al-Muthalath al-Dhaby (Golden Triangle) economic zone; (iii) the New Administrative Capital; and (iv) the geographic locations most urgently in need of development, including the area south of the Giza governorate, governorates affiliated to the Suez Canal region (i.e. parts of Port Said, Ismailia and Suez governates on the eats of the canal and the border governorates (e.g. Red Sea and the Upper Egypt governorates, New Valley, Matrouh). Additional areas may be decided by the Prime Minister.
Source: Information provided by the Government of Egypt.
Egypt has introduced a broad and ambitious policy framework to support the development of a green hydrogen economy, combining fiscal incentives, spatial planning and regulatory guidelines. Laws such as Law No. 2/2024 and Investment Law No. 72/2017, along with their accompanying cabinet decrees, offer tax rebates of up to 55% for green hydrogen projects, land usufruct rights and port fee reductions. Complementary instruments, like Cabinet Decrees No. 981 and 983 of 2022, identify designated zones for hydrogen production and task GAFI with co-ordinating implementation. Additionally, measures such as Circular Letter 2/2023 and the Green Bond Guidelines aim to establish market mechanisms for clean energy procurement and enhance transparency in green finance. Together, these policies create a theoretically robust enabling environment for hydrogen deployment across production, storage and export.
However, the implementation of these policies and mechanisms have lagged behind their legal articulation. While Egypt has introduced generous incentives and designated zones for green hydrogen development, project realisation remains limited. Most initiatives are still in the memorandum of understanding or pre‑feasibility stage. Fragmented co-ordination among regulatory authorities, particularly on grid access, environmental permitting and infrastructure planning, continues to impede progress. Although investment laws offer attractive terms and procedural streamlining, investors often face bureaucratic delays and regulatory uncertainty. This reflects a broader challenge: Egypt’s strength in policy formulation is not yet matched by the implementation capacity needed to deliver large-scale, bankable projects.
As a result, no green hydrogen projects in Egypt have yet reached final investment decision. Nevertheless, the hydrogen economy represents a critical opportunity for Egypt to capitalise on its renewable energy potential, address domestic energy needs and position itself as a regional export hub. Realising this potential requires overcoming the barriers that delay project progression to FID. The economic, regulatory and sectoral insights presented in Chapter 1 form the basis for the following chapters, which explore financial solutions and enabling investment conditions to move projects toward implementation.
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← 1. The national price estimate of USD 1.8/kg H2 by 2040 is used for comparative purposes. As highlighted earlier in the report, the OECD calculations of LCOH use a consistent set of assumptions, which are not directly derived from Egypt’s National Low-Carbon Hydrogen Strategy. Findings should thus be considered indicative and comparative rather than definitive, especially as the estimated future price of low-carbon hydrogen cannot easily be compared with LCOH. Moreover, it is important to note that this cost-versus-price comparison does not account for potential reductions in CAPEX due to technological learning expected between now and 2040. While such advancements are likely to lower costs over time, their impact is deliberately excluded from this assessment to maintain consistency in assumptions. As with any technical-economic analysis, results should be interpreted as indicative and comparative rather than definitive.
← 2. Low-carbon technologies refer to all technologies that offer a lower or near-zero emission solution to conventional production processes that emit CO2.
← 3. Under the Egypt-OECD Country Programme, CEFIM is implementing two work streams: (i) developing low-carbon hydrogen under the OECD Framework for Industry net-zero transition: Developing financing solutions in emerging and developing economies and (ii) financing transmission grid in Egypt by developing case studies to identify financing model (Denis, 2026[82]).
← 4. A wheeling fee is a charge paid by a private electricity producer to the EETC for using its transmission grid infrastructure when supplying electricity to end users.
← 5. The EGP to USD conversion used in this document is based on exchange rates of the first quarter of 2025 (Ministry of Planning, Economic Development and International Cooperation, n.d.[104]). All calculations in USD are indicative and may no longer reflect the current exchange rate.
← 6. The GBI-EM is designed to track the performance of bonds issued by emerging market governments and includes only those countries that are accessible by most of the international investor base.
← 7. Egypt pledged to bring all SOEs – including army-owned companies – within a unified framework for transparent financial management and reporting, to publish comprehensive and detailed annual and twice-yearly tax expenditure reports, to end tax exemptions for SOEs, and to improve customs procedures and information sharing. (Sayigh, 2025[105]).
← 8. The swaps are a financial tool that enables countries to allocate fiscal resources toward climate resilience and nature conservation while maintaining the flexibility to address other development priorities without exacerbating fiscal strain.
← 9. Samurai and Panda bonds are foreign-denominated bonds issued by non-resident entities in Japan and China, respectively.
← 10. Sukuk bonds are Islamic financial certificates like a bond in Western finance, that comply with Islamic religious law.
← 11. The industrial sector comprises manufacturing industries as defined in the International Standard Industrial Classification of All Economic Activities (ISIC).
← 12. Engineering, Procurement and Construction (EPC) is a form of contract used to undertake construction works by the private sector on large-scale and complex infrastructure projects. The procurement scheme entails a variety of clauses, in terms of price, completion date, performance and if well specified, can substantially cover the upfront investment risks perceived by lenders. Moreover, EPC helps if the lender lacks the required engineering expertise to develop a renewable energy project.
← 13. The BOO contract is a particular form of project financing that consists in a public private partnership where the private company builds, owns and operates the power plant independently form the government, under specified agreement and time conditions.
← 14. In 2018, Egypt introduced a Special Incentive scheme that permits investors to deduct 30% or 50% of investment costs, with a focus on capital expenditures rather than income-based deductions. This expenditure-based approach is generally more effective in lowering upfront investment barriers. Initially targeted at sectors such as renewable energy and green manufacturing, the scope of the incentive was broadened in March 2022 to include projects of strategic environmental importance, including green hydrogen, green ammonia, waste management, e-mobility and alternatives to single-use plastics. However, as the incentive remains available to both green and non-green projects, its effectiveness in specifically advancing the green transition may be limited by the absence of targeted differentiation (OECD, 2024[45])