Saudi Arabia's Acwa inks deal for world's largest renewable project in Dubai
China's President Xi Jinping and Spain's PM Pedro Sánchez attended a contract signing ceremony with Acwa
Saudi Arabia-headquartered Acwa Power, in which the kingdom's Crown Prince HRH Mohammad bin Salman Al Saud-led Public Investment Fund (PIF) holds a stake, has partnered with the Industrial and Commercial Bank of China (ICBC), Shanghai Electric Group Co (SEGC), and Spanish company Abengoa to build the world's largest renewable energy project, the Noor Energy 1 solar plant in Dubai.
Top executives from the four entities entered an agreement to work together on the Noor Energy 1 plant in Dubai, engage in knowledge-sharing, and collectively pursue future opportunities. Chinese President Xi Jinping and Spanish Prime Minister Pedro Sánchez attended the ceremony during Jinping's official visit to Spain.
Acwa Power is lead developer on the project while ICBC has established its role as an international lender for Noor Energy 1.
Earlier this year, Acwa Power signed an engineering, procurement, and construction (EPC) agreement with SEGC for the scheme. Abengoa is one of the main technology providers and key subcontractors for the Noor Energy 1 plant.
Commenting on the agreement, Paddy Padmanathan, chief executive officer of Acwa Power, said: “We are proud to be the catalysts for this collaboration on a global scale in this instance focused at accelerating the decarbonisation of power generation by enabling the reliable delivery of solar power day and night and look forward to working with these entities within the framework of this cooperation agreement to identify and execute meaningful market opportunities that will allow us to continue to reliably deliver electricity and desalinated water at the lowest cost.”
Dubai Electricity and Water Authority's (Dewa) IV independent power producer (IPP) project, which was awarded to an Acwa Power-led consortium in 2017, is the fourth phase of the Mohammed bin Rashid Al Maktoum Solar Park, the largest single-site concentrated solar power plant in the world.
The project, initially expected to deliver 700 megawatts of energy, will use a combination of the world’s tallest 260m-high solar tower that will generate 100MW; three stations of parabolic trough concentrated solar power (CSP) each producing 200MW; and photovoltaic panels generating 250MW, for a total capacity output of 950MW.
The scheme is projected to deliver electricity at a levelised tariff of $7.323 cents per kilowatt-hour 24 hours a day. This price competes with fossil fuel generated electricity without subsidy for reliable and dispatchable solar energy around the clock.
The plant will support the Dubai Clean Energy strategy 2050 to increase the share of clean energy in Dubai to 25% by 2030 and is expected to provide an annual saving of 2.4 million tons of CO2.
In July 2018, Saudi Arabia’s sovereign wealth fund, PIF acquired a 15.2% stake in Acwa Power after agreements began with an offer early in 2017.
PIF now owns 15.2% direct stake in the developer, owner, and operator of power generation and water desalination plans. Additionally, through the 9.78% separate stake ownership by its wholly owned subsidiary, Sanabil Direct Investments Company, PIF’s total shareholding – direct and indirect – in Acwa Power amounts to 24.98%.