Q&A: How Egypt is navigating the green hydrogen economy

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Egypt’s ambitious green hydrogen economy stems from coordinated and integrated planning and governance, says Dr Mohamed Abo Eldahab. He notes that by linking renewable energy, production facilities and end users, while ensuring stakeholders work in sync, the country has enabled efficient project implementation.

• Dr Abo Eldahab is General Manager of the Green Economy Department at the Suez Canal Economic Zone (SCZone), home to a significant portion of Egypt’s green hydrogen projects. He also serves on the country’s Supreme Council for Hydrogen and has been instrumental in modernising Egypt’s bunkering ecosystem to meet international standards.

• In an interview, he acknowledges fragmentation as a key challenge facing green hydrogen in Africa and says other nations can learn from Egypt’s coordinated model to turn ambition into actionable projects.

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Egypt is often seen as a frontrunner in Africa’s green hydrogen economy. What is the country doing right that its peers can emulate?

Dr. Abo Eldahab: To produce hydrogen, you need renewables. Renewables must be connected to the production site, and the production site must be connected to the end user. The key stakeholders such as the authorities, investors, and operators  all need to coordinate closely. In Egypt, if you want to invest, you sit at one table with all of them, all at the “supreme council of green hydrogen.” That’s not something you see everywhere. 

You have to identify every element of the process and know who the competent authorities are. And those authorities need to operate in sync, at the same frequency, at the same time. You shouldn’t have a situation where today you meet one person, tomorrow another, and they conflict with each other. This approach is similar to what Germany is doing, operating as a single consortium, as one unit. 

Across Africa, many countries used to have a fragmented approach, but that is changing. Egypt is a clear example. Namibia, South Africa, and Morocco are also doing very well. African countries are increasingly understanding how to manage these projects effectively. In Egypt, we know the game and how to handle it very well now.

SCZone hosts multiple green hydrogen projects. Can you explain what factors make it a leading hub for green hydrogen? 

Dr. Abo Eldahab: The SCZone is designed as an industrial hub and also hosts green hydrogen. We initially signed 28 framework agreements with investors, and five projects are actively progressing. What makes SCZone unique is the a shared, ready-to-use facility with fully integrated infrastructure including the port, a liquid bulk terminal, storage tanks, pipelines, and production facilities are all connected. This allows investors to plug in efficiently, scale their projects, and access both domestic and export markets without building major infrastructure from scratch. 

How is the country positioning itself in the green hydrogen market and what are the main challenges investors face in turning plans into projects?

Dr. Abo Eldahab: There are three things you have to look at: your target-your country goal, the EU goal, and the actual situation. Regarding Egypt, we have a national plan to gradually convert fossil fuels to renewable energy. This is mainly for two reasons. First, to reduce pressure on hard currency because we import a lot of LNG. Second, to comply with the Paris Agreement. That’s why our national plan aims for 42% of electricity in Egypt to come from renewable sources, up from 24%. 

Then, looking at the EU, they are under pressure because of the Russia-Ukraine conflict and the disruption of LNG supply. They need replacements and also have their own Paris Agreement targets. The northern EU has a lot of renewable resources, while the middle and southern regions are more traditional, with a mix of fossil and renewable energy. Since the EU is interconnected, they can benefit from each other, but this makes them focus on countries with a strong renewable energy profile, like Egypt. 

Now, the actual situation. Governments have national plans to produce green hydrogen. Like any regular investment, the companies should invest in that because if the country itself invests in that, it's a huge amount of investment. After COP27, ambitions for green hydrogen have grown. Egypt has taken steps like creating an investment law to attract green hydrogen investment and signing several framework agreements and MOUs to show commitment. But none of these 28 agreements have yet resulted in company participation. The reason is simple: green hydrogen is more expensive than grey hydrogen. 

Even though EU standards now incentivise green production through tax measures, the gap remains. Without commitment from investors, no one can reach a Final Investment Decision (FID), so projects are still at the planning stage, except for some early initiatives like the H2 Global initiative. For example, Fertiglobe has a factory in Egypt producing green hydrogen. They have a terminal in Rotterdam and were able to offer a competitive price because they already have many elements in place, which is why they secured the project. 

What would you say are the reasons why so many ambitious green hydrogen projects in Africa face a gap between announcement and implementation? 

Dr. Abo Eldahab: Honestly, this isn’t specific to Africa; it’s a global issue. Even in the EU, no one will finance a project with unclear goals. The main problem is commitment. Once there’s a clear commitment, it becomes much easier to close the gap and secure financing to start the project. The challenge is finding those who are willing to commit. 

In addition, the regulatory landscape, particularly in the EU, adds another layer of complexity. Standards such as the Renewable Fuels of Non-Biological Origin (RFNBO) under the Renewable Energy Directive (RED I, II, and now RED III) set very stringent criteria for what qualifies as ‘green’ hydrogen. While these frameworks are essential for ensuring environmental integrity and traceability, their technical and administrative requirements are extremely demanding. This has made it challenging for companies to reach Final Investment Decisions (FID), as they must navigate evolving certification rules, additional compliance costs, and long approval timelines. These uncertainties significantly slow down project realization, even for well-structured initiatives. 

In your view, what are the two most important actions Africa should take to develop its green hydrogen economy?

Dr. Abo Eldahab: First of all, we need to select actual projects because there's a lot of fishy things happening in this market now in the name of green hydrogen. We have to focus on identifying the ones that have real potential for the future. Second, these projects should fit within our development plans. We must avoid creating unnecessary burdens on our economies while pursuing green hydrogen. In the end, we have to make sure our work benefits our countries and that we are not running after something that is unclear.