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Financing agreements signed by ACWA Power for Dubai solar project

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Energy Global,

ACWA Power, a leading Saudi Arabian developer, investor and operator of power generation and desalinated water plants, has completed the signing of all financing agreements of the 900 MW solar PV project, Shuaa Energy 3 PSC, which is the fifth phase of the Mohammed bin Rashid Al Maktoum Solar Park in Dubai. Shuaa Energy 3 PSC is the special purpose vehicle incorporated for the project, with 60% ownership by the Dubai Electricity & Water Authority (DEWA) and the balance split between ACWA Power and Gulf Investment Corporation (GIC).

The project involves the construction of a state-of-the-art 900 MW solar PV plant, using bi-facial panels with tracking technology at a capital cost of US$564 million, and has been the focus of significant international interest, having demonstrated one of the lowest levelised cost of electricity in the world of $US0.016953 per kWh.

The financing for the project is based on the principles of limited recourse project financing with the senior debt provided by a number of international, regional and local banks along with a project recourse mezzanine tranche committed by a regional bank, structured as a 27-year soft mini perm fi-nancing with both conventional and Islamic tranches. In addition, the financ-ing structure featured a set of equity bridge loans provided by local banks and also by DEWA.

The financing group to the Project included Abu Dhabi Islamic Bank, Arab Petroleum Investment Corporation, Industrial and Commercial Bank of Chi-na, Emirates NBD Bank, Natixis, SAMBA Financial Group, Standard Char-tered Bank and Warba Bank. Additionally, a project recourse mezzanine tranche was provided by Commercial Bank International and equity bridge facilities provided by Commercial Bank of Dubai, Emirates NBD Bank and Mashreq bank.

“Securing this amount of long tenor project financing for Shuaa Energy 3 PSC even as COVID 19 pandemic continues to cause social and economic disruption to the entire world illustrates the combined capabilities and trust-ed partnership between ACWA Power and DEWA. We are delighted to have achieved this significant milestone, which reflects confidence of the financial community in this partnership, and the role and iconic status of the fifth phase of Mohammed bin Rashid Al Maktoum Solar Park in delivering Du-bai’s Clean Energy Strategy 2050.” Paddy Padmanathan, President & CEO of ACWA Power.

“Project financing of this magnitude having been successfully raised from nine project finance lenders in the midst of a global pandemic, is the ulti-mate testament to DEWA’s credibility as a counterparty and the success of their IPP programme, as well as ACWA Power’s focus and proven ability to deliver power and desalinated water reliably and responsibly at low cost.” Rajit Nanda, Chief Investment Officer of ACWA Power.

The EPC agreement for the construction of the project was signed with Shanghai Electric in July 2020.



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