Journal of Renewable Energy and Sustainable Development (RESD)        Volume 3, Issue 3, December 2017 - ISSN 2356-8569 

http://dx.doi.org/10.21622/RESD.2017.03.3.241 

 

 

 

 

 

 

For many decades, it has been stated that renewable energy, RE, needs subsidy, otherwise it will not 

be able to compete or sustain. For a certain level, this statement was valid. In this period, the 

investment costs for both wind and photovoltaic, PV, were high. In other words, production costs of 

both of them reached around 7.0 and 13.0 Cent US$ per kWh. On the other hand, oil and natural gas, 

NG, prices were low; i.e. less than US$ 30.0 per oil barrel and around US$ 4.0 per million British 

thermal unit, MMBTU, of NG. Also, policies of promoting RE were limited; almost there are two main 

policies, Feed-in-Tariff, FiT, in limited developed countries and international tenders. As a result, 

investment in RE was usually led by developed countries and minor share from the developing 

countries. This was the scene of RE before around 10 years.   

Nowadays, the scene of RE totally differs. Starting from the policies side, through auctions in both 

solar and wind energies, new records of prices have been reached. In numbers, in the field of wind 

energy Morocco and Egypt already signed contracts with prices lower than 4.0 US$ Cents/kWh. For 

PV, there is a dramatic devaluation in the prices. Now we are speaking for less than 0.7 million US$ 

per MW for turnkey projects.  As a result, during the last couple of years, the global RE market 

witnessed a bundle of an outstanding prices, El-Sewihan Project at Abu Dhabi, 2.42 US$ Cent/kWh. 

Mexico and Dubai projects, 3.6 and 3.0 US$ Cent/kWh. Few days ago, Dubai Electricity and Water 

Authority, DEWA, received $9.45 cents per kilowatt-hour for its 200MW concentrated solar power 

(CSP) plant. 

All these figures, and others, gave us important messages; 1) Despite low prices of oil and NG, RE is 

able to compete and offer outstanding prices, 2) Wind and PV technologies do not need any kind of 

subsidy, rather than they need a real free market to compete, 3) CSP is a low hanging fruit and it will 

witness a frog-leap during the coming couple of years, 4) Even CSP still high, compared with both PV 

and wind, but is a dispatchable energy. So, it is a game changer. 5) There is a need for more R&D 

efforts in storage technology. 6) The role of small-scale applications; i.e. biomass and PV, still need 

further development in the developing countries. 7) Most of the outstanding recent prices have been 

fulfilled by developing countries, which means that their role in promoting RE applications, grow year 

by year. 

About Mohammed Mostafa El-Khayat  

Dr. Mohammed Mostafa El-Khayat, got his Ph.D. from Mansoura University Egypt, and the Business 

Diploma Certificate from Eslsca School of Business, Paris, France. He is the Chairman of the New 

and Renewable Energy Authority, NREA in Egypt. Also, he is the Chairperson of Renewable Energy 

and Energy Efficiency Committee, League of Arab State, LAS. He has over 25 years of experience in 

the fields of Renewable Energy, environment, and academic activities. He is responsible for the wind 

and solar energy projects. Also, he is responsible for the energy efficiency activities. Dr. El-Khayat 

shared in drafting Pan Arab Renewable Energy Strategy issued by League of Arab States. Also, he is 

participating in drafting renewable energy laws and regulations. El-Khayat received many awards from 

different countries and worked with different regional and international entities. Finally, he issued 5 

books and writing a weekly article in Al Ahram Newspaper. 

241 

 

RESD © 2017 

http://apc.aast.edu 

Does Renewable Energy Still Need Subsidy 

Dr. Eng. Mohamed Mostafa El Khayat 

Chairman of the New and Renewable Energy Authority, NREA 

Chair of Renewable Energy and Energy efficiency of Arab 

Experts Committee, League of Arab States, LAS 

http://dx.doi.org/10.21622/
http://apc.aast.edu/