Masdar-led consortium reaches financial close on solar project in Jeddah

The 300-megawatt solar power plant will begin operations in 2022

A field of solar panels at Saudi Arabia's King Abdulaziz City of Sciences and Technology. The kingdom plans to generate 50% of its power from renewables by 2030. Reuters

A consortium led by Abu Dhabi renewable energy company Masdar and France's EDF Renewables reached financial close on a 300 megawatt solar power plant project in Jeddah.

The consortium, which also includes Saudi Arabia-based Nesma Company, is starting construction on the plant that is scheduled to begin operation in 2022, the companies said in a statement on Saturday.

The solar plant will be located in Third Jeddah Industrial City.

The Renewable Energy Project Development Office (REPDO), a department within Saudi Arabia's Ministry of Energy, awarded the utility-scale photovoltaic Jeddah project to the consortium after it submitted the lowest bid of 60.9042 Saudi riyals ($16.24) per megawatt hour.

"Through its National Renewable Energy Programme, Saudi Arabia is fast developing into a global renewable energy player, and Masdar will continue to work closely with the Saudi government and our partners here to help the kingdom achieve its clean energy transition, while reducing environmental impacts in line with the Saudi Green Initiative," Mohamed Al Ramahi, chief executive of Masdar, said.

Saudi Arabia, the world's largest exporter of oil, is expanding its renewable project portfolio as it seeks to green its power mix and export more barrels of oil. The kingdom plans to add gas and renewables capacity equating to one million barrels of oil per day by 2030, according to the kingdom's Crown Prince Mohammed bin Salman.

The Crown Prince comments came on April 8 during the signing of seven power purchase agreements for new solar photovoltaic plants in Saudi Arabia following the inauguration of the Sakaka plant. The 300MW Sakaka power plant is the kingdom's first-ever solar utility-scale project.

Saudi Arabia aims to generate 50 per cent of its electricity from renewable sources by 2030.

In 2019, a consortium led by EDF Renewables in partnership with Masdar was selected to build a 400MW utility-scale wind farm in Dumat Al Jandal – Saudi Arabia’s first wind energy project and the largest in the Middle East. The plant will start operation and generate carbon-free electricity by late 2022.