PIF subsidiary, ACWA Power to develop MENA’s largest solar plant in Saudi Arabia

The Water and Electricity Holding Company (Badeel) and ACWA Power signed power purchase agreements to develop a 2,060MW solar photovoltaic (PV) plant in Al Shuaibah, Makkah province.

The project, which is expected to achieve commercial operations by the fourth quarter of 2025, is the largest facility of its kind in the Middle East to date.

It will be jointly owned by Badeel and ACWA Power, which is a developer, investor, and operator of power generation, water desalination and green hydrogen plants worldwide. Meanwhile, Badeel is a wholly owned company of Saudi Arabia’s sovereign wealth fund – Public Investment Fund (PIF).

ACWA Power expands its solar portfolio in Saudi Arabia, and signs a key power purchase agreement with The Water and Electricity Holding Company “Badeel”, wholly owned by Saudi PIF, to develop a 2,060MW solar photovoltaic (PV) plant in Al Shuaibah, Makkah province. pic.twitter.com/ZCUbpLbBWi

— ACWA Power-Accelerating Energy Transition Globally (@ACWAPower) November 30, 2022

Each company will hold a 50 per cent equity stake through the establishment of a joint company – Shuaibah Two Electrical Energy Company. Furthermore, the Shuaibah Two Electrical Energy Company announced the signing of the power purchase agreement for the project with the Saudi Power Procurement Company (SPPC), the offtaker within this project.

Badeel and ACWA Power will build, own, and operate Al Shuaibah 2 facility and the electricity produced will be sold to SPPC. When complete, the facility will power 350,000 homes.

“This marks a key achievement toward PIF’s commitment to develop 70 per cent of Saudi Arabia’s renewable energy by 2030,” said Yazeed A. Al-Humied, deputy governor and head of MENA investments at PIF.

“Utilities and renewables is one of PIF’s priority sectors as part of its domestic strategy, which focuses on unlocking the capabilities of promising sectors to enhance Saudi Arabia’s efforts in diversifying revenue sources.”

“It is a great honour to partner with Badeel and SPPC in developing this milestone project which will set a benchmark for sustainable energy development in the region,” added Mohammad Abunayyan, chairman, ACWA Power.

“Solar power is a key component in unlocking positive economic, environmental and social outcomes for the betterment of communities across our great nation. We remain committed to developing local capabilities in technology, supply chain, and talent and ensure they are realised to their fullest potential,” he added.

Shuaibah 2 is ACWA Power’s sixth solar energy facility in Saudi Arabia. In addition, the ACWA Power’s Saudi portfolio comprises 13 power, water desalination and green hydrogen plants.

Badeel and ACWA Power are also developing the Sudair Solar PV 1500MW project.

Read: Aramco joins group building giant solar plant in Saudi Arabia