Saudi Power Procurement Company (SPCC) has awarded the consortium of Masdar, EDF Renewables and Nesma Renewable Energy a contract to construct the 1,100 MW Al Henakiyah solar plant in Saudi Arabia. Furthermore, the companies have inked a 25-year power purchase agreement (PPA) with the Saudi Power Procurement Company. The SPPC awarded the consortium the project after it submitted the bid of $16.84 per MWh.
As per the agreement with SPPC, the Masdar-led consortium will design, construct, and manage the solar park. The project is anticipated to displace more than 1.8 million tonnes of carbon dioxide yearly and power over 190,000 homes once it is operational. Furthermore, the project is planned to cost around $1 billion and the financial close is anticipated in the first half of 2024 and connect to the grid in 2025.
In September 2023, Masdar and Jinko Power were finalised for the construction of two solar projects in Saudi Arabia with a total capacity of 1.5 GW. Reportedly, the Saudi Power Procurement Company chose the bidders for round 4 solar projects.
REGlobal’s Views: Saudi Arabia has plans to increase the share of renewables in the country’s energy mix to around 50% by 2030 and it is becoming a major investment hotspot for overseas investors. EDF Renewables already has a few projects in the country including the 400 MW Dumat al Jandal wind power farm and the 300 MW South Jeddah Solar Park, and this project will help to increase its market share in the country. Meanwhile, Masdar has been ramping up its expansion activities across various new markets like Uzbekistan, Kazakhstan, Iraq and Saudi Arabia.