Abu Dhabi has received six bids to build a 350 megawatt solar plant in the emirate, one of which was cited by the Abu Dhabi Water & Electricity Authority (Adwea) as equating to the lowest cost for solar power generation by a commercial project.

The proposed Sweihan plant east of Abu Dhabi is part of efforts by the oil-rich capital of the UAE to diversify its energy base into renewables as it seeks to generate seven per cent of its power from green methods by 2020.

Of the six Sweihan bids, the lowest equated to 2.42 US cents per kilowatt-hour (kWh), state-owned Adwea said in a statement carried by official news agency WAM.

"It represents one of the most competitive prices seen to date in the global solar photovoltaic industry," the statement said. The bidding companies were not named.

The cost of generating solar power has been falling as the cost of the technology improves, while Middle Eastern nations have sought to drive down the price they pay for solar projects to take advantage of the region's year-round sunshine.

Neighbouring emirate Dubai said in May that the third phase of Dubai Electricity and Water Authority's (Dewa) Sheikh Mohammed bin Rashid al-Maktoum Solar Park had attracted a lowest bid of 2.99 cents/kWh.

The Sweihan plant would be Adwea's first foray into renewable energy, though green energy company Masdar has launched some renewables projects in the emirate. Adwea currently has 11 gas-fired independent water and power projects.

Commercial operations at the Sweihan plant are expected to begin in the first quarter of 2019, Adwea's statement said.

A source told Reuters last December that the chosen developer would own 40 per cent of the project, with 60 per cent held by Adwea.-Reuters