Masdar-Lead Consortium Completes Financing for 2GW Solar Project in Saudi Arabia

A consortium led by Abu Dhabi Future Energy Company (Masdar) has successfully completed the financial closing for the 2GW Al Sadawi solar photovoltaic (PV) project in Saudi Arabia.

This project is part of the Saudi government’s National Renewable Energy Program (NREP), with a total investment estimated at USD 1.1 billion. The consortium has signed financing agreements with 8 regional and international financial institutions, including Standard Chartered Bank, Korea Eximbank (KEXIM), Abu Dhabi Commercial Bank (ADCB), BNP Paribas, Abu Dhabi Islamic Bank, Bank of China, HSBC, and Société Générale.

The project will be developed under the Build-Own-Operate (BOO) model by Masdar, China Guodian Corporation, and Korea Electric Power Corporation. It is scheduled to be connected to the grid in early 2027. Additionally, the consortium has entered into a 25-year Power Purchase Agreement (PPA) with the Saudi Power Procurement Company (SPPC).

When the project was tendered in 2024, it won the bid with an offer price of USD 1.2926 per kilowatt-hour.

Key Term Explanations (for clarity): – **Financial Closing: A critical milestone in project finance, referring to the completion of all legal and financial procedures, after which funds become available for the project. –

BOO (Build-Own-Operate): A public-private partnership model where the developer constructs, owns, and operates the project infrastructure for the long term, rather than transferring ownership to the government.

PPA (Power Purchase Agreement): A long-term contract between a power generator (project developer) and a power purchaser (e.g., SPPC here), specifying terms for electricity supply, pricing, and duration.