Nuweiba Power Plant

Nuweiba Power Plant

The complaint at stake concerned the environmental and social impact of a project for the construction of a 750MWe natural gas-fired combined-cycle power generation plant in Nuweiba, Egypt, 200 km north of Sharm-el-Sheik on the west cost of South Sinai, Aqaba Golf. The project promoter was the Egyptian Electricity Holding Company (EEHC).

Since 19 May 2009, the Complaints Mechanism received 24 different complaints challenging the Environmental and Social aspects of the Project, coming from managers/owners of hotels, scuba diving centres, beach side camp owners, citizens of Nuweiba, local NGO, tourist operators, resident EU citizens and from local communities including the 2 major Bedouin tribes of the area. An on-line petition to the Egyptian government to stop the Project raised more than 2.300 signatures.

Allegations: Lack of proper public consultation, no proper consideration given to local economy, tourist resources and local communities, no proper consideration given to preservation of local biodiversity and marine habitats.

The EIB Complaints Mechanism (EIB-CM) conducted its Initial Assessment, which included extensive stakeholder engagement and an on-site fact finding visit in order to determine the opportunities for mediation/consultation process and/or the need  for a compliance review. As a result of this assessment it apperared that the concerns raised by the Project’s Interested and Affected People were serious and needed to be further examined. In line with applicable procedures, the EIB-CM commissioned an independent expert review on three main areas of concern:

• Project’s impact on the biodiversity of the sea waters (Aqaba Gulf);
• Economic impact of the project on the local tourist industry;
• Social impact of the project on local communities, particularly the Bedouins.

The EIB-CM, supported by the three independent experts, concluded that the concerns expressed by the complainants were well founded. On the basis of the information gathered and of its final assessment, the Complaints Mechanism concluded that, under the proposed conditions, if the Power Plant would be constructed in the proposed Nuweiba location, the damage to the environment and the local tourist industry as well as the negative social impact on local communities would be serious and could be irreparable. Moreover, the EIB-CM took the view that these could lead to violence and conflict in the area.

EEHC and the Egyptian authorities have been informed of the CM findings, conclusions and recommendations above, which they have contested.  On that basis, and considering the EIB’s position not to consider financing the project at this conjuncture, EEHC and the Egyptian authorities decided to withdraw the request for EIB support towards this project.
A new project Giza North II power plant was approved by the EIB Board on 20.09.2011. This project is adjacent to an already existing power plant in an area without human occupation.