CAIRO, Jun 14 (Aswat Masriya) - Egyptian private energy firm Elsewedy Electric signed an agreement to develop a solar power plant in Upper Egypt with a capacity of 50 megawatts, the company said on Sunday. 

Elsewedy Electric, which has operations across the Middle East and North Africa, has established a subsidiary to fund and operate the project, it said in a statement published on the Egyptian stock market's website. 

Investments in the project are expected to be around $75 million, the company said.

The power plant will be set up in Aswan, nearly 800 kilometres south of the capital Cairo. Aswan, which is one of Egypt's biggest tourist attractions, is sunny and clear all year long, making it a prime location for the power plant.

Egypt has been encouraging several projects to develop energy sources to face its recurring energy crisis. President Abdel Fattah al-Sisi was cited by Reuters as saying in September that Egypt needs to add 12,000 megawatts to its power grid over the next five years. 

The energy produced from the power plant will be sold to the state's electricity distribution company for $0.1434 for every kilowatt per hour, on a 25-year contract. The deal is guaranteed by Egypt's finance ministry, Elsewedy Electric said. 

The peak of Egypt's power crisis was last summer, when power cuts lasted for up to several hours a day. 

Egyptian authorities have attributed the power crisis to a larger fuel crisis and have recently turned to renewable energy such as solar and wind energy.

Egypt has also sought the assistance of Russia in setting up a nuclear power plant, in an agreement in February.

But the shift towards new and renewable energy will cost the state a lot. In October, Egypt's Electricity Minister Mohamed Shaker said the cost of producing renewable energy is "much larger" than that of relying on fossil fuels.

Last month, Investment Minister Ashraf Salman said it is expected that investments worth $45 billion will be pumped into Egypt's new and renewable energy sector over the next 10 years.