TAQA, JERA, Al Bawani Capital to develop 2 power plants in Saudi Arabia

Image: TAQA Group

Abu Dhabi National Energy Company (TAQA), JERA (Japan’s largest power generation company), and Al Bawani Capital, a subsidiary of AlBawani Holding, have announced a significant milestone in their partnership.

The trio has entered into two 25-year power purchase agreements (PPAs) with Saudi Power Procurement Company (SPPC) to develop two new greenfield combined cycle gas turbine (CCGT) power plants in Saudi Arabia, with a total generation capacity of over 3.6 gigawatts (GW).

The PPAs are a result of SPPC’s decision to award the contracts for the Rumah 2 and Al Nairyah 2 independent power producer (IPP) projects to the consortium of TAQA, JERA, and AlBawani.

Each project will have a capacity of 1.8 GW, collectively contributing to Saudi Arabia’s ambitious energy mix strategy.

The two power plants will utilise the most advanced CCGT turbines available, and the projects will be designed with the flexibility to incorporate carbon capture technologies. This aligns with Saudi Arabia’s national energy goals, which aim to produce 50 per cent of the country’s electricity from renewable sources and 50 per cent from gas technology by 2030.

Furthermore, these initiatives are part of the Saudi Green Initiative, which seeks to achieve net-zero greenhouse gas emissions by 2060, or earlier, depending on the availability of appropriate technologies.

The power plants will be developed through special purpose entities owned by TAQA (49 per cent), JERA (31 per cent), and AlBawani (20 per cent). These entities will also be responsible for the operation and maintenance (O&M) of the plants, ensuring high efficiency and sustainability, backed by the same ownership structure.

Strategic growth for TAQA and global collaboration

Farid Al Awlaqi, CEO of TAQA’s Generation business, expressed excitement over the new developments, stating, “TAQA has ambitious growth targets of 150 GW by 2030, and today’s announcement represents a major milestone for 2024, with the addition of 3.6 GW of low-carbon gas-fired power capacity in Saudi Arabia. This brings the total number of greenfield projects TAQA is developing in the kingdom to five.

“As the lead developer, we will oversee the operations and maintenance of these world-class plants, further demonstrating our expanded capabilities.”

TAQA’s involvement in these projects reinforces its commitment to sustainable energy development and its role as a trusted investor, developer, and operator in key international markets. The company aims to support Saudi Arabia’s energy transition by delivering efficient and reliable power solutions that contribute to the Kingdom’s Vision 2030.

Commitment to decarbonisation by JERA

Steven Winn, chief global strategist at JERA, highlighted the alignment of the projects with the company’s sustainability goals.

“These two high-efficiency independent power projects, featuring state-of-the-art HL class gas turbines, reinforce JERA’s commitment to decarbonising thermal power generation. This significant achievement was made possible through strong teamwork with our partners, TAQA and AlBawani, and with the support of SPPC,” Winn said.

JERA’s focus on achieving net-zero emissions by 2050 underpins its role in these projects, helping to move the global energy landscape towards a more sustainable future.

AlBawani’s role in Saudi Arabia’s energy transformation

Fakher AlShawaf, group CEO of AlBawani Holding, emphasised the importance of this partnership for Saudi Arabia’s energy diversification efforts. “This project marks a transformative milestone for AlBawani, reinforcing our commitment to advancing the kingdom’s energy diversification initiatives. We aim to deliver a highly efficient and reliable power solution that will meet the growing energy demands of the kingdom while fostering local expertise and economic growth.”

The collaboration highlights AlBawani’s commitment to sustainable practices, with the goal of advancing Vision 2030 and supporting Saudi Arabia’s broader energy goals.

The company also sees the project as an opportunity to contribute to the development of local talent and create long-term economic benefits for the country.

As Saudi Arabia moves towards a balanced and sustainable energy mix, the Rumah 2 and Al Nairyah 2 projects will play a key role in meeting the kingdom’s electricity demand while also advancing its environmental and economic goals.