- ACWA Power has signed up SPPC as the principal buyer for 700 MW Ar Rass Solar Project in Saudi Arabia
- The 25-year PPA will see the project coming up as an IPP in Al Qassim province with SAR 1.7 billion investment
- Project is likely to achieve financial closure in Q4/2022 and start commercial operations in Q4/2024
Saudi Arabian energy company ACWA Power has secured the Saudi Power Procurement Company (SPPC) as principal buyer for power from 700 MW Ar Rass Solar PV independent power producer (IPP) for a period of 25 years.
ACWA Power said the PPA brings it financial surety to develop the 700 MW solar project in Al Qassim province that’s expected to cost SAR 1.7 billion ($450 million). Project is expected to achieve financial closure in Q4/2022 and come online in Q4/2024.
The Saudi Arabian company will own 40.1% stake in the project once complete, with 20% held by the Water and Electricity Holding Company (Badeel) which is a wholly owned PIF Portfolio company. Remaining 39.9% stake will be owned by China’s State Power Investment Corporation (SPIC).
According to ACWA Power, the Ar Rass project is the largest PV project tendered to date under the country’s National Renewable Energy Programme (NREP). The company is already operating 300 MW Sakaka Solar Project in Saudi Arabia, and constructing 1.5 GW Sudair Solar Project with Aramco and Badeel (see Financial Closure For 1.5 GW Saudi PV Project).
Through NREP, Saudi Arabia aims to diversify its energy mix and reduce its dependence on oil targeting 50% of its energy mix to come from renewables. In specific terms it would translate into 27.3 GW by 2023 and 58.7 GW by 2030, mostly driven by solar.
ACWA Power says it has been ‘earmarked to deliver 70% of the total 58.7 GW target’.