ACWA Power announces financial close for 1500MW Sudair solar plant

Plant will help KSA achieve the goals of Vision 2030, ACWA Power says

ACWA Power, the developer, investor and operator of power generation and desalinated water plants, has announced the financial close for the 1500 MW Sudair Solar plant, a key project under the Public Investment Fund (PIF) renewable energy program.

The launch of the Sudair Solar project was announced at the inauguration of Sakaka PV project in April 2021, under the patronage of HRH Prince Mohammed bin Salman bin Abdulaziz, Crown Prince, Deputy Prime Minister, Chairman of the Supreme Committee for Energy Mix Affairs for Electricity Production and Enabling Renewable Energy Sector, and in the presence of HRH Prince Abdulaziz bin Salman bin Abdulaziz Al Saud, Minister of Energy.

A specialised Saudi technical team at the Ministry of Energy selected the Sudair project site and carried out the engineering requirements and preliminary studies of the project with the aim of achieving the highest levels of efficient energy production and contributing to shaping the circular carbon economy, which the Kingdom adopted during its presidency of the G20 last year.

“Underpinned by our ambition and determination to continue driving the transformation of the Kingdom’s energy sector, I would like to extend my sincere gratitude and pride following the signing of agreements for the first project under the PIF Renewable Energy Program,” said Mohammad Abunayyan, chairman of ACWA Power.

“This milestone marks progress in achieving the goals of Vision 2030 and the requirements of the National Renewable Energy Program launched by the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud; guided by the directives of His Royal Highness the Crown Prince, Mohammed bin Salman bin Abdulaziz; and reinforced by the unparalleled support of His Royal Highness Prince Abdulaziz bin Salman, Minister of Energy, to accomplish this ambitious vision,” he added.

The Sudair solar plant is testament to the Kingdom’s continuous efforts to reduce emissions resulted by the energy sector, Abunayyan said. He added that the Ministry of Energy is utilising its Renewable Energy Program and Local Content Development Program to enable the prosperity of the solar energy sector and its supply chains through various initiatives such as mobilising private sector investments and encouraging partnerships between the public and private sectors to create a competitive national market for renewable energy.

ACWA Power also announced that SAPCO, a fully owned company of Aramco, has joined the consortium with ACWA Power and Badeel, a company fully owned by PIF. The consortium, led by ACWA Power, embodies the strategic importance of the Sudair Solar PV project, the first project under PIF’s renewable energy program.

The program aims to support Saudi Arabia’s ongoing energy transition and diversification, and to deliver 70% of the country’s renewable energy under the National Renewable Energy Program (NREP).

ACWA Power – in which PIF holds a 50% stake – and Badeel will each own 35% in the special purpose vehicle “Sudair One Renewable Energy Company”, which was incorporated for the project; with SAPCO holding a 30% stake.

The Renewables and Utilities sector is one of the 13 priority sectors that PIF identified as a key focus area in its Strategy 2021-2025. The strategy focuses on unlocking the capabilities of the private sector and aims to increase local content contribution to 60% Including PIF and its portfolio companies, in addition to expanding opportunities for local companies to partake in the Fund’s projects.

Aramco’s investment in the Sudair Project is its first participation with PIF in its renewable energy program; reflecting the company’s efforts to advancing sustainable energy solutions within its operations and Saudi Arabia, where a variety of low-carbon energy solutions are being deployed.

With an investment value of $906.5 million, the Sudair Solar PV project, which is located at Sudair Industrial City, is set to become one of the largest single-contracted Solar PV plants in the world and the largest of its kind in Saudi Arabia. A 25-year power purchase agreement for the plant was signed with the Saudi Power Procurement Company, with the tariff being among the lowest for solar PV projects globally.

Using bi-facial modules with tracking technology, the plant is set to deliver highly efficient performance and be capable of powering 185,000 homes, while offsetting nearly 2.9 million tons of emissions per year.

The financing for the project is based on the principles of limited recourse project financing, with the senior debt structured as a soft mini perm facility with a tenor of 28 years and both conventional as well as Islamic tranches. The financing structure also features a set of equity bridge facilities provided by local and international banks supporting the sponsor group’s equity investment in the project.

The financing group includes Mizuho Bank, Ltd., Riyad Bank, Korea Development Bank, Arab Petroleum Investments Corporation (APICORP), Al Rajhi Banking & Investment Corporation, and Standard Chartered Bank as senior lenders and Mandated Lead Arrangers. The equity bridge facilities are provided by Bank Al Bilad, Saudi British Bank and SMBC International Plc.

0 0 votes
Article Rating


Most Popular

To Top
Would love your thoughts, please comment.x