Acwa Power, a leading Saudi utility project developer and a leader in energy transition, has announced that its consortium has secured financial closure for the Al Shuaibah solar projects being developed in Jeddah at a total investment of $2.37 billion.

 

The consortium comprises Electricity Holding Company (Badeel), a wholly owned unit of Saudi sovereign wealth fund PIF (Public Investment Fund) and Saudi Aramco, with Acwa Power holding a 35% equity stake.

 

With a 2,061 MW capacity, Al Shuaibah (comprising Al Shuaibah 1 and 2 projects) is set to become the world’s largest solar project once it gets operational in 2025, said the Saudi utility developer in a statement.

 

According to Acwa Power, the senior debt financing for this plant, amounting to $1.63 billion, comprises a $450 million Saudi riyal-denominated loan from the National Development Fund on behalf of the National Infrastructure Fund.

 

Additionally, the financing includes a $1.18 billion US-dollar-denominated commercial facility provided by a consortium of local, regional, and international banks including Bank Saudi Fransi, First Abu Dhabi Bank, Mizuho Bank, Riyad Bank, Saudi National Bank, Standard Chartered Bank and Saudi Investment Bank)

 

Saudi Power Procurement Company is the procurer and off-taker for the projects. This new project will be jointly owned by Badeel, which will have a 34.99% stake, while Acwa Power and Sapco will hold shares of 35.01% and 30% respectively. 

 

Acwa Power said once completed, the Al Shuaibah PV project is expected to provide power to approximately 450,000 households.

 

"Securing financing for this groundbreaking project marks a significant step toward achieving Saudi Arabia’s clean energy goals, in alignment with the National Renewable Energy Program, which aims to generate 50 percent of electricity from renewable sources by 2030," remarked its CEO Marco Arcelli. 

 

Badeel CEO Husam Al Ghailani said the PIF unit will continue its efforts to support the renewable energy sector in the Kingdom, and to develop 70 percent of Saudi Arabia’s renewable energy by 2030.

 

Mohammed Al-Qahtani, president of downstream at Saudi Aramco, added: “While oil and gas will play a major role to meet the energy demand of today and tomorrow, renewables will increasingly play a part in the energy transition to address the climate change challenges. The projects mark a significant milestone to support Aramco in achieving its decarbonization targets.”