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ACWA Power to offer implementing 2,000 MW renewable energy project Project will be offered next week, in cooperation with UAE's Masdar company, says ACWA Regional Manager
Saudi ACWA Power and Emirati Masdar plan to make an official offer to the Ministry of Electricity next week to establish renewable energy projects with a capacity of 2,000 MW. These include 1,500 MW in solar energy, and 500 MW through wind energy. These projects set to be established by ACWA Power and Masdar are part of the agreements and memoranda of understanding (MoUs) signed during the Economic Summit held in Sharm El-Sheikh last March. Hassan Amin, Regional Manager of ACWA Power, said that a meeting was held with Minister of Electricity Mohamed Shaker and head of the Renewable Energy Authority Mohamed Salah Al-Sobki in order to agree on the next steps for the projects. Their financial closing is expected to be completed six months after signing the agreement to buy energy. According to Amin, a number of international bodies agreed to finance the project. However, Masdar and ACWA Power's shares in the project have not yet been agreed upon. He added that the MoU was drafted with accuracy, and there were no disagreements regarding the project's implementation. ACWA Power plans to launch three plants to generate electricity from solar and wind energy in Egypt with 150 MW capacity and investments worth $205m. ACWA Power was qualified for the establishment of new and renewable energy projects according to the feed-in tariff system approved by the cabinet. The company will launch a solar energy plant with a capacity of 50 MW in Benban in Aswan, and two wind energy plants with a capacity of 100 MW in the Gulf of Suez. Amin said the company will begin negotiations with a number of institutions in order to finance 75% of the total project costs. ACWA Power has made a request to the Egyptian Electric Utility and Consumer Protection Regulatory Agency (EgyptERA) in order to obtain a temporary license to generate electricity. This came after the establishment of the renewable energy company according to the standards and procedures determined by EgyptERA. Bank letters of guarantee were repaid to the authority with a value of 1% of total project cost. Lands were allocated for the three projects in Aswan and Suez, and currently, all the measurements and studies for the projects are being undertaken, according to Amin. He further pointed out that the studies will take approximately 12 months in order for wind speed to be calculated, while the solar energy plant's studies will be completed within four months. Amin expected the financial close of the 50 MW solar energy plant to be completed in the fourth quarter of 2016, while financial close for the wind energy projects will be finished in the first quarter of 2017. He said the Ministry of Electricity and Renewable Energy has put forth a strategy to implement projects with the private sector through companies with previous experience and financial and technical solvency that allows them to complete the projects. Regarding the project to establish a power plant in Safaga with a capacity of 2,000 MW, Amin said that ACWA Power has obtained all the necessary approvals from sovereign authorities in order to begin project studies and conduct all the necessary land measurements, as well as discuss the possibility of increasing project capacity to about 4,000 MW. He explained that the Ministry of Electricity is still studying the only offer made by ACWA Power to establish the Dayrout power plant in Beheira with a capacity of 2,250 MW, after the company won the tender put forth by the ministry. The technical and financial offer made by the company is being evaluated, whereby the estimated cost of the project, which uses the combined cycle system, is nearly $2bn. The Dayrout power plant in Beheira will be established on an area of 70 acres, and will be composed of three units with a capacity of 750 MW per unit. The plant uses the combined-cycle system, which produces a third of the energy without using extra fuel. It is expected that the plant will begin operating before summer 2017, according to the directives of the political administration. Amin refused to reveal the offer made by ACWA Power to establish the Dayrout power plant, explaining that the tariff has several calculations that are determined according to the cost of the project as well as the design, value of currency, fuel price and the period of the project, in addition to several other considerations, such as maintenance operations.
