Abu Dhabi National Energy Company, known as Taqa, and Dubal Holding will acquire Emirates Global Aluminium’s water and power generation assets in Al Taweelah for $1.9 billion in a push to boost clean energy development in Abu Dhabi.
The acquired assets will be held under a joint venture company, with the ownership shared equally between Taqa and Dubal, Taqa said in a statement on Thursday to Abu Dhabi Securities Exchange, where its shares are traded.
Operations will be managed by a new company jointly owned by Taqa and EGA.
Al Taweelah power plant, with a capacity of 3.1 gigawatts, is the third largest in Abu Dhabi. It also has a desalination capacity of 23.6 million litres per day.
Dubal is the investment arm of the Investment Corporation of Dubai, the sovereign wealth fund of the emirate's government, while EGA is the largest industrial company in the UAE outside of the energy sector.
As part of the deal, the Taqa and Dubal joint venture company signed an agreement with Emirates Water and Electricity Company under which Ewec will purchase power from Al Taweelah plant until 2049 to help it integrate renewables and clean energy into Abu Dhabi grid.
The deal also involves Taqa Transmission buying EGA’s electricity transmission assets as it undertakes a project to increase the overall interconnection capacity from the main grid to EGA’s sites from 640 megavolt-amperes to 3,360 megavolt-amperes, with completion expected in 2027.
“The acquisition of EGA’s Al Taweelah power assets enhances our portfolio and supports our 2030 ambition of reaching 150 gigawatts of power generation capacity globally,” said Jasim Thabet, group chief executive and managing director of Taqa.
“By connecting EGA to the Abu Dhabi grid, we are collectively enabling the decarbonisation of one of the UAE’s important industries, significantly reducing their emissions and further advancing our ambition for a cleaner energy future.”
Largest single electricity customer on Abu Dhabi grid
EGA also signed Abu Dhabi’s largest electricity supply agreements with Ewec and Taqa Distribution, which will make the aluminium producer the largest single electricity customer on the Abu Dhabi grid.
These agreements provide EGA with 23 terawatt hours of electricity per year for 24 years.
“This initiative is one of the largest decarbonisation projects ever in the global aluminium industry," said Abdulnasser bin Kalban, chief executive of EGA. "For our global customers, it significantly increases the availability of low carbon ‘premium aluminium."
EGA plans to increase the production of CelestiAL solar aluminium and MinimAL low-carbon aluminium produced using nuclear power to as much as almost half its total primary aluminium production by the end of 2028, depending on market demand.
The production increase will start from the fourth quarter of this year, EGA said.
The latest deal, which is expected to close in the new year, depending on regulatory approvals, will also reduce gas consumption per unit of electricity generated and contribute towards Taqa and Ewec achieving greenhouse gas emission reduction targets for electricity generation in Abu Dhabi.
Abu Dhabi’s greenhouse gas emissions are expected to reduce by 3.5 million tonnes annually by 2035, more than 3 per cent of Abu Dhabi’s total, following the initiative.
