TDIC signs cooling plant deal with Dalkia-Arcapita

Pair to run three plants in first PPP deal to be signed for Saadiyat

St Regis Hotel, which will be completed at the end of 2011, will receive cooling from the plants.
St Regis Hotel, which will be completed at the end of 2011, will receive cooling from the plants.

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Abu Dhabi’s Tourism Development & Investment Company (TDIC), the master developer of projects across the biggest emirate, has awarded a public private partnership contract (PPP) concession to priovide district cooling on Saadiyat to a joint venture partnership between Dalkia and Arcapita.

The project – the first PPP concession of its kind on Saadiyat - will incorporate three plants, and will be one of the Middle East’s largest district cooling plant operations, providing a combined capacity of fifty thousand tonnes of refrigeration (177 MW), and servicing a 27km2 area.

Dalkia, a European energy services provider, and Arcapita, an investment bank focused on alternative asset investment, will design, build, finance, operate and maintain the plants over a 29-year concession to cool hotels in the Saadiyat Beach District, including the Park Hyatt Abu Dhabi Hotel and Villas, and St Regis Saadiyat Island Resort, both of which are due to open later this year.

They will also service the Saadiyat Marina Apartments and Saadiyat Cultural District, comprising the Zayed National Museum, Guggenheim Abu Dhabi, Louvre Abu Dhabi and Performing Arts Centre. Two of the three cooling plants will be completed by 2012, with the third, in Saadiyat Beach District, to be finished in 2016 as further projects reach completion.

“TDIC’s objective in the cooling element of Saadiyat’s infrastructure was to develop a strategy that will provide cost-effective, efficient cooling services across the 1.6 million m2 built up area, while managing the issues of water conservation and environmental output,” said Andrew Seymour, TDIC’s director of infrastructure. “Dalkia and Arcapita’s expertise in district cooling made them the most appropriate fit for Saadiyat’s cooling needs.”

Dalkia is a subsidiary of Veolia Environnement and Electricité de France (EDF), and a provider of energy services to local authorities and businesses, with 819 district and local heating and cooling systems. It will engineer the plants and manage their construction and operation.

Arcapita has a diverse range of long-term investments through venture capital, private equity, infrastructure and real estate with US $400 million of financing investments as of June 2010. It will provide the financing for the three plants.

A PPP deal is the latest mode of financing for the vast array of projects in the portfolio of TDIC, which raised $1 billion on the bond market and $1 billion through a sukuk at the start of 2010.

The companies will recover their investment through charges to echo the island’s properties for the cooling service. The timescale upon which they will make a return is undisclosed.


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