Water and Electricity Holding Company (Badeel), a 100% subsidiary of Saudi Arabia’s Public Investment Fund (PIF), and ACWA Power have invested SAR12.2bn ($3.25bn) in three new solar photovoltaic (PV) projects in Saudi Arabia with a combined capacity of 4.55GW.
The three projects are Ar Rass 2, Saad 2, and Al Kahfah solar PV, which will have capacities of about 2GW, 1.12GW, and 1.42GW, respectively.
Badeel and ACWA Power have signed power purchase agreements (PPAs) with the Saudi Power Procurement (SPPC) for the development and operation of the three solar independent power producer (IPP) projects.
To be developed as a part of Saudi Arabia’s National Renewable Energy Program (NREP), the solar PV projects will be jointly owned by Badeel and ACWA Power.
The Saudi Arabia Ministry of Energy is leading and supervising NREP and the country’s sovereign wealth fund PIF is mandated to develop 70% of the target capacity of the programme by 2030.
PIF energy and utilities head Mohammed AlBalaihed said: “The three new solar projects are part of PIF’s commitment to develop 70% of Saudi Arabia’s renewable energy by 2030, in line with the National Renewable Energy Program.
“Renewable Energy is one of PIF’s priority sectors, with a focus on unlocking the capabilities of promising sectors and enabling the private sector to enhance Saudi Arabia’s efforts in diversifying the economy.”
The Ar Rass 2, Saad 2, and Al Kahfah solar power projects, put together, are expected to provide electricity to nearly 750,000 households. Their financial close is anticipated to be achieved by Q3 2023.
ACWA Power CEO Marco Arcelli said: “As a Saudi national champion, we are incredibly proud to lead Saudi Arabia’s ambitious energy diversification plans and contribute towards achieving its Net Zero targets.
“Today’s signing of three Power Purchase Agreements marks a significant milestone for ACWA Power, representing the largest single transaction for solar projects in our company’s history.”
Last month, ACWA Power signed a new $123m financing package for the 200MW Kom Ombo solar power project in Egypt with various financial organisations.
