ACWA Power signs 700MW power purchase deal for Saudi solar PV project

Multi-utility developer ACWA Power and the Saudi Power Procurement Company (SPPC) on Tuesday signed a power purchase agreement (PPA) to develop the 700 MW Ar Rass solar photovoltaic independent power plant (IPP) in Saudi Arabia’s Al Qassim province.

Under the terms of the agreement, ACWA Power will sell energy produced by the project to SPPC for a period of 25 years. Valued at US $450 million (SAR 1.7 billion), Ar Rass is the largest PV project that has been tendered as part of Saudi Arabia’s National Renewable Energy Programme (NREP) to date, for which ACWA Power has been mandated to deliver 70 percent of the total 58.7 GW target.

ACWA Power will hold a 40.1 percent stake in the facility, along with 20 percent by the Water and Electricity Holding Company (Badeel), a wholly owned PIF Portfolio Company, and 39.9 percent will be owned by the State Power Investment Corporation from China. When fully functional, the project will produce energy to power around 132,000 homes in central Saudi Arabia.

The agreement was signed in the presence of Prince Abdulaziz bin Salman bin Abdulaziz Al Saud, Minister of Energy of Saudi Arabia. During the signing ceremony, the Minister of Energy announced that the energy sector aims to launch several renewable energy projects to produce approximately 15,000 megawatts of clean energy between the years 2022 and 2023, with the aim of diversifying the energy mix and achieving its designated targets.

“As Saudi Arabia’s leadership ramps up its multi- gigawatt plans for diversifying its energy mix to include renewable energy, solar power is a key component in unlocking positive economic, environmental and social outcomes, whether it is for consumer use, or in mega-projects,” said Mohammad Abunayyan, Chairman, ACWA Power. “At ACWA Power, we are proud to be part of this larger story and will work diligently to realising the multiplying effect of solar power, whether it is in job production or emissions mitigation. We thank our partners in the Ministry of Energy for entrusting us with this important project so that we can work in the delivery of our mission in providing responsible, reliable and affordable power.”