Saudi Arabia's Acwa Power has signed an initial agreement to build a 10-gigawatt wind farm in Egypt, which could be the world's second-largest wind farm.
The Riyadh-based utility signed the preliminary agreement with the north African country's New and Renewable Energy Authority and the Egyptian Electricity Transmission Company on Tuesday, the Saudi Energy Ministry said.
Egypt's Minister of Electricity and Renewable Energy Mohammed Shaker met Saudi Energy Minister Prince Abdulaziz bin Salman on an official visit to discuss co-operation between the two countries in the fields of electricity and renewable energy.
The value of the project was not disclosed and the final agreements will be dependent on feasibility studies, as well as the availability of land, the Saudi Energy Ministry said.
The agreement comes days before the UN's Cop27 climate summit takes place in Sharm El Sheikh from November 6 to November 18.
Egypt aims to increase its renewable energy sources to 42 per cent by 2035, from about 11 per cent in 2019.
Acwa Power develops, invests in and operates power generation and desalinated water plants. It currently has 67 projects in operation or under construction with an investment value of more than $66.5 billion in 13 countries across Asia and Africa.
It aims to increase its power-generating capacity from 43 gigawatts to 120 gigawatts over the next decade.
The company already has two solar energy projects and another wind farm project planned in Egypt.
Its three solar photovoltaic power plants in Aswan's Benban Solar Park, with a combined capacity of 120 megawatts and a total investment value of $185 million, started operations in 2019.
Its 200-megawatt Kom Ombo solar plant, also in Aswan, is set to be operational in the third quarter of 2023. It is expected to provide power to 130,000 households and offset 280,000 tonnes of carbon dioxide a year.
An Acwa-led consortium that includes Egypt-based Hassan Allam Holding signed a $1.5bn agreement in June for a 1.1-gigawatt wind project in the Gabal El Zeit area in the Red Sea's Gulf of Suez.
Once operational by the end of 2026, the plant will be capable of powering more than a million homes while offsetting about 2.4 million tonnes of emissions annually, Acwa said.
Earlier this week, Egypt's Orascom Construction, Toyota's trading arm Toyota Tsusho and French multinational utility Engie broke ground on a 500MW wind farm in Ras Ghareb close by.
Currently, Egypt's largest wind farm, which produces 545MW, is in Zafarana, also in the Ras Ghareb area.
The world's largest wind project is the Gansu project in China, which has a planned capacity of 20 gigawatts.
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Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
