A consortium led by Saudi Arabia-based ACWA Power and Spanish engineering firm TSK announced that they have won the contract to build a solar power plant for the second phase of Mohammed Bin Rashid Al Maktoum Solar park.
The project, which has a net power capacity of 200 MW (260MWp installed), is the largest utility scale solar plant in the world tendered in a single phase, the company said in a statement.
Upon completion, the plant will produce enough electricity to power 30,000 homes every year, using photovoltaic (PV) solar panels to generate electricity. It is estimated that the project will also reduce carbon emissions by 469,650 tons of CO2 equivalent emissions for every year of operation.
The announcement follows DEWA’s statement that it had selected the consortium of ACWA Power and TSK as the preferred bidder for the project.
As part of the deal, ACWA Power will receive a levelised tariff of $5.84 cents/kWh for a 25-year power purchase agreement (PPA) starting in 2017, the statement said.
“Dubai has a clear strategy to diversify its energy mix with renewable energy, and specifically solar, playing a key role,” said Paddy Padmanathan, president and CEO, ACWA Power.
“This when combined with a politically stable environment and the availability of low-cost finance means that solar PV technology becomes commercially cost effective.”
The public tender for constructing the second phase of the Mohammed bin Rashid Al Maktoum Solar Park was launched in 2014 using a build-own-operate (BOO) model. Around 24 independent power producers (IPPs) prequalified with bids from 10 consortia.
The project is the second phase of the Mohammed bin Rashid Al Maktoum Solar Park development, located on a 40 square kilometer site to the south-east of Dubai. Further expansion of the power project will see the facility grow to produce 1,000 MW of electricity by 2030.
Solar power generation has been increasingly finding favour in the Gulf with the cost of its production falling by almost 75 per cent over the last few years, a report by Middle East Solar Industry Association found.
As a result, solar projects worth $2.7 billion are set to be awarded over the next 12 months in the MENA region, the report added.