ACWA Power and AlGihaz Holding Company, a Saudi contractor and investor, acting as a consortium have announced the successful financial closure of the SAR 1.2 billion ($320 million) Sakaka photovoltaic independent power project (IPP).
A new company, Sakaka Solar Energy Company (SSEC), has been formed to own the 300 megawatt Sakaka PV Plant. The plant is the first ever utility scale renewable energy project to be developed in Saudi Arabia under the National Renewable Energy Program, executed by REPDO (Renewable Energy Project Development Office).
ACWA Power will hold 70 percent of SSEC, th Saudi utility developer said in a statement on Thursday. AlGihaz will hold the remaining 30 percent through its subsidiary, AlGihaz Renewable Energy Company.
“SSEC has concluded a 25 years Power Purchase Agreement with Saudi Power Procurement Company (SPPC) acting as offtaker,” the statement said.
The transaction is financed through limited recourse ring fenced project financing, with the entire debt fully underwritten by Natixis as initial mandated lead arranger and bookrunner.
In addition, Arab National Bank provided an equity bridge loan for the transaction.
The Sakaka project’s commercial operation date is scheduled to be towards the end of calendar year 2019.
Upon completion, the plant will supply more than 75,000 households with green power, while offsetting over 430,000 tonnes of carbon dioxide per year.
The engineering, procurement and construction (EPC) contract for the project was awarded to a consortium of Mahindra Susten and Chint.
Meanwhile, the operations and maintenance agreement was signed with Diaa Sakaka Operation and Maintenance Company, an affiliate of First National Operations & Maintenance Co. Ltd. (NOMAC).
The Saudi REPDO awarded the project to the ACWA Power Consortium in January, at a world record tariff of US Cents 2.3417/kWh (8.781 halalas/kWh).
The plant is located in Al Jouf at a site spanning over six square kilometers.
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