Despite offering by far the lowest tariff in their proposal, Masdar and EDF EN didn’t make the cut for Saudi Arabia’s 300 MW Sakaka tender. The last two contenders are ACWA, a Saudi-based company, and a consortium led by Japanese company Marubeni.
- World’s Lowest solar bid was not shortlisted for 300 MW Sakaka PV tender in Saudi Arabia
- Instead, ACWA Power and a Marubeni Corp.-led consortium, comprising Khaled Ahmed Jaffali Energy & Utilities Ltd. and Axia Power Holdings BV, were picked for the final round
- Winner will be announced before the end of January 2018, with financial project close scheduled for February 2018
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ACWA Power and a consortium led by Japan’s Marubeni Corp. have been shortlisted for the final tender round of the 300 MW project in Sakaka, Saudi Arabia by the Renewable Energy Project Development Office (REPDO).
Eight companies had offered technical bids to develop 300 MW of PV capacity in the tender. The lowest bid, which came in at 0.0668 halalas ($0.01785) per kWh, was offered by Abu Dhabi Future Energy Company (Masdar) and EDF EN of France. Yet, despite bidding the world’s lowest solar tariff by far, REPDO has selected the next two bidders in the row. This capacity will be developed as part of the first round of the National Renewable Energy Program (NREP).
ACWA Power is in the running with its bid of $0.0234 per kWh and Marubeni consortium is bidding for the entire capacity for $0.0266 per kWh (see Record-Low Solar Bid <2¢ For Saudi Tender). The members of the Marubeni consortium include Khaled Ahmed Jaffali Energy & Utilities Ltd. and Axia Power Holdings BV.
However, as LeAnne Graves, an energy reporter with media organization Abu Dhabi Media (ADM), points out in her LinkedIn post, a key component for the project was to have local financiers on board. But Masdar and some other submissions apparently did not list any banks. Moreover, Masdar was said to be the only bidder including bifacial solar panels in its project proposal, which would explain the very low tariff offer. Bifacial modules, which produce energy on both sides of the solar cell, can generate 10-30% higher yields, which makes it a very attractive technology for PV projects, as explained in a recent TaiyangNews Bifacial Solar Technology report (see Time To Go Bifacial Has Come). However, lacking standards and bankability are still obstacles for using that technology.
The final winner will be announced before the end of January 2018. Saudi Power Procurement Company (SPPC) will enter a power purchase agreement (PPA) with the winners for a period of 25 years. Once announced, the winner will have to ensure financial close of the project in February 2018.
REPDO has conducted a detailed evaluation of material compliance to RFP requirements, including the 30% local content component for the initial round of NREP projects. All of eight companies who participated in the tender are eligible to participate in future projects run by the NREP.
The NREP is a strategic initiative under the country’s Vision 2030 and the National Transformation Program (NTP) through which Saudi Arabia wants to increase the share of renewable energy in the total energy mix to 9.5 GW by 2023.