Masdar, EDF Renewables, and Nesma have inked a Power Purchase Agreement (PPA) with the Saudi Power Procurement Company (SPPC) to advance the ambitious 1100MW Al Henakiyah solar power plant. The estimated $1 billion project is poised to achieve financial closure in early 2024 and connect to the grid in 2025.
The SPPC awarded the consortium the prestigious project after it presented the most cost-competitive bid at a rate of $16.84 per megawatt hour. As part of a broader initiative to stimulate the local economy, a minimum of 19% of equipment, materials, and services for the project's construction phase will be sourced from Saudi companies.
Moreover, during the initial decade of operations, Saudi nationals will constitute 50% of the project's workforce, a proportion set to increase to 75% over the entire operational lifespan of the solar plant.
The Al Henakiyah Solar Plant, located in Al Madinah province, plays a pivotal role in Saudi Arabia's mission to elevate the proportion of renewables in its energy mix to approximately 50% by 2030. As one of the world's largest single-site solar facilities, this project will be developed, constructed, owned, and operated by the consortium under a 25-year agreement with the off-taker, SPPC.
Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, expressed his pride in securing the bid, stating, “Masdar is proud to have won the bid to develop the 1100MW Al Henakiyah Solar Plant, further strengthening our partnership with Saudi Arabia. The Kingdom is a key strategic market for Masdar, and we are committed to supporting the Ministry of Energy and the SPPC in achieving the targets outlined in Vision 2030 and the Saudi Green Initiative, as the country accelerates its transition toward net zero emissions by 2060.”
This monumental project signifies a significant stride toward Saudi Arabia's renewable energy objectives, exemplifying the country's dedication to sustainability and its transition to cleaner, greener energy sources.