Saudi-based ACWA Power on Thursday announced it has completed the signing of all financing agreements for the fifth phase of the Mohammed bin Rashid Al Maktoum Solar Park in Dubai.
Shuaa Energy 3 is the special purpose vehicle incorporated for the project, with 60 percent ownership by the Dubai Electricity and Water Authority (DEWA) and the balance split between ACWA Power and Gulf Investment Corporation (GIC), the company said in a statement.
The project involves the construction of a 900MW solar PV plant, using bi-facial panels with tracking technology at a capital cost of $564 million.
ACWA Power said the project has been the focus of “significant international interest”, having demonstrated one of the lowest levelised cost of electricity in the world of 1.6953 US cents per kWh.
Paddy Padmanathan, president and CEO of ACWA Power, said: “Securing this amount of long tenor project financing for Shuaa Energy 3 even as Covid-19 pandemic continues to cause social and economic disruption to the entire world illustrates the combined capabilities and trusted partnership between ACWA Power and DEWA.
“We are delighted to have achieved this significant milestone, which reflects confidence of the financial community in this partnership, and the role and iconic status of the fifth phase of Mohammed bin Rashid Al Maktoum Solar Park in delivering Dubai’s Clean Energy Strategy 2050.”
Rajit Nanda, chief investment officer of ACWA Power, added: “Project financing of this magnitude having been successfully raised from nine project finance lenders in the midst of a global pandemic, is the ultimate testament to DEWA’s credibility as a counterparty and the success of their IPP programme, as well as ACWA Power’s focus and proven ability to deliver power and desalinated water reliably and responsibly at low cost.”
The EPC agreement for the construction of the project was signed with Shanghai Electric in July.
The 900MW fifth phase of the solar park is expected to become operational in stages starting from the second quarter of 2021.
The Mohammed bin Rashid Al Maktoum Solar Park is the largest single-site solar park in the world.
Blessed with near-year-round sunshine, utility authorities in both Dubai and Abu Dhabi have invested heavily in developing solar energy resources.
Solar energy equally contributes to the country’s medium to long-term decarbonisation and sustainable development objectives aligned with the UAE’s National Energy Plan 2050. The plan aims to increase the contribution of clean energy in the total energy mix from 25 percent to 50 percent by 2050 and reduce carbon footprint of power generation by 70 percent, with savings estimated at around $190 billion (AED700bn) by 2050.
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