- ACWA Power, Badeel, and Sapco have achieved financial closure for three solar projects in Saudi Arabia, with a total investment of $3.2 billion and a combined capacity of 5.5 GW.
- The Haden, Muwayh, and Al Khushaybi solar plants are located in the Makkah and Qassim regions, with capacities of 2GW, 2GW, and 1.5GW, respectively.
- The financing for the projects, worth $2.5 billion, was provided by a consortium of local, regional, and international banks, including Banque Saudi Fransi, Mizuho Bank, and HSBC.
- ACWA Power’s renewable energy portfolio in Saudi Arabia now includes 14 projects, representing over 17.8 GW of combined capacity.
In a significant stride toward Saudi Arabia’s renewable energy ambitions, ACWA Power, alongside Badeel and Saudi Aramco Power Company (Sapco), has achieved financial closure for three solar photovoltaic (PV) projects.
These ventures represent a combined investment of $3.2 billion and will generate an impressive 5.5 gigawatts (GW) of clean energy, aligning with Saudi Arabia’s National Renewable Energy Programme (NREP).
The initiative underscores the kingdom’s aim to become a leader in sustainable energy solutions while contributing to global environmental goals.
The Partnership Behind the Projects
ACWA Power, a pioneering force in energy transition, teamed up with Badeel, a fully owned subsidiary of the Public Investment Fund (PIF), and Sapco, a subsidiary of Saudi Aramco, to execute three major solar PV initiatives: the Haden, Muwayh, and Al Khushaybi plants.
These projects are strategically located in the Makkah and Qassim regions of Saudi Arabia, with individual capacities of 2 GW, 2 GW, and 1.5 GW, respectively. Badeel, ACWA Power, and Sapco jointly own the projects, reflecting a strong collaboration between the private and public sectors to propel Saudi Arabia’s renewable energy sector.
The Saudi Power Procurement Company (SPPC), acting as the procurer and off-taker, plays a crucial role in ensuring these solar plants contribute significantly to the country’s energy grid. This venture is part of the larger vision to produce 70% of the country’s renewable energy needs by 2030, a goal championed by the Ministry of Energy and backed by PIF.
Financial Backing and Investment Partners
The financial framework for these large-scale projects was secured through senior debt financing worth $2.5 billion. The funding was sourced from a diverse group of financial institutions, both local and international, ensuring robust support for the ambitious initiatives.
Key players in this consortium include Banque Saudi Fransi, Mizuho Bank, Riyad Bank, Saudi National Bank, Standard Chartered, Emirates NBD, First Abu Dhabi Bank, and HSBC. Their involvement underscores the confidence the financial sector has in Saudi Arabia’s renewable energy future.
ACWA Power’s CEO, Marco Arcelli, expressed his excitement about the financial closure, stating, “This is a major step toward realizing Saudi Arabia’s long-term renewable energy ambitions. These projects mark our continued dedication to providing clean, reliable, and cost-efficient energy solutions.” Arcelli also extended his gratitude to stakeholders and financial partners for their crucial support in turning this vision into reality.
Sultan AlNabulsi, Acting CEO of Badeel, echoed similar sentiments. He noted, “Reaching this milestone is a testament to the rapid growth of Saudi Arabia’s renewable energy sector. We are proud to contribute to PIF’s target of achieving 70% of the kingdom’s renewable energy by 2030.” His comments highlight the strategic importance of these projects in Saudi Arabia’s green energy future.
Expanding the Renewable Energy Portfolio
The completion of financial agreements for these solar PV plants is part of a broader effort by PIF to enhance the renewable energy value chain. This is not an isolated project; it aligns with a series of investments made by PIF aimed at positioning Saudi Arabia as a global hub for renewable energy manufacturing and development.
In July, PIF revealed plans for three new joint ventures designed to boost the local production of wind turbines and solar components. These ventures are expected to play a pivotal role in supporting the global energy transition, while reinforcing Saudi Arabia’s position as a key player in the international renewable energy landscape.
Currently, PIF and its partners are working on several renewable energy projects with a combined capacity of 13.6 GW. This involves investments exceeding $9 billion, further demonstrating the scale of Saudi Arabia’s commitment to green energy.
Future of Renewable Energy in Saudi Arabia
As these new solar plants become operational, they will significantly contribute to Saudi Arabia’s energy supply, reducing the country’s reliance on traditional fossil fuels. The development of renewable infrastructure is a crucial aspect of Saudi Arabia’s Vision 2030 initiative, which seeks to diversify the economy and reduce the environmental impact of energy production.
Saudi Aramco, through its subsidiary Sapco, is playing a vital role in driving the energy transition. Waleed Al Saif, Senior Vice President of New Energies at Saudi Aramco, emphasized that the partnership with ACWA Power and Badeel helps further the kingdom’s renewable energy ambitions.
“These projects represent a key step in expanding our renewables portfolio and meeting rising power demand with lower emissions,” Al Saif stated. He added that Aramco’s New Energies division is focused on advancing alternative energy solutions, such as renewables, carbon capture, and lower-carbon hydrogen.
ACWA Power’s Expanding Solar Portfolio
With the addition of these three projects, ACWA Power’s solar portfolio in Saudi Arabia has grown significantly. The company now oversees 14 solar PV projects across the kingdom, with a total capacity of more than 17.8 GW. This expansion reinforces ACWA Power’s position as a leader in renewable energy both locally and internationally.
The company’s total renewable energy capacity now stands at an impressive 35 GW, demonstrating ACWA Power’s ongoing commitment to supporting Saudi Arabia’s energy transition. As the kingdom continues to invest in renewable energy infrastructure, ACWA Power is poised to play a central role in delivering clean, sustainable energy solutions that align with national and global environmental goals.
Looking Ahead
The financial close of these solar PV projects marks a significant milestone in Saudi Arabia’s journey toward a greener and more sustainable future. The partnership between ACWA Power, Badeel, and Sapco, supported by a robust financial consortium, is a strong testament to the kingdom’s commitment to renewable energy.
As the country continues to invest in renewable energy, it is set to become a global leader in the transition toward cleaner energy sources.
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