The Dubai Electricity and Water Authority (DEWA) and ACWA Power, have signed an Engineering, Procurement and Construction (EPC) contract with Shanghai Electric for the Rashid Solar Park 700MW CSP project in Dubai.
The project, which is the the fourth phase of the Mohamed bin Rashid Solar Park, is said to be the largest thermo-solar power plant in the world.
The EPC agreement pushes forward the development of the project, which represents a $3.87 billion investment. Read more: DEWA secures $650m for green projects
The agreement was signed on Sunday in Shanghai in presence of representatives from the Chinese government, the embassies of the United Arab Emirates, and the Kingdom of Saudi Arabia as well as senior officials from DEWA, ACWA Power, the Silk Road Fund, Industrial and Commercial Bank of China (ICBC), Bank of China, Agricultural Bank of China and China Minsheng Bank.
“I am pleased to be here in Shanghai to attend the signing of the Engineering, Procurement and Construction Agreement for the completion of the fourth phase of the Mohammed Bin Rashid Al Maktoum Solar Energy Complex,” said DEWA MD & CEO of DEWA, HE Saeed Mohammed Al Tayer.
ACWA Power Chairman, Mohammad Abunayyan, added: “By signing this agreement, we have taken a significant step towards starting the engineering and construction works. We are committed to supporting Dubai's Clean Energy Strategy through this project, which extends our portfolio in the energy sector in Dubai.”
The project is in the process of concluding the financing package. ICBC is acting as the mandated lead arranger and targeting to approve $1.5 billion of senior loan.
This project is a flagship project for ICBC in supporting the three major Chinese power equipment suppliers, namely Shanghai Electric, Dongfang Electric and Harbin Electric, to “go abroad” and break through the sophisticated and established power market.
ICBC, Bank of China and Agricultural Bank of China will play a role in the financing of the project, providing about 80% of senior debt.
Rashid Solar Park
The project, which comes with a record low tariff of just $7.3 cents per kilowatt hour (kW/h), will feature a combination of a tower and parabolic troughs, which will collect heat and store it in molten salt to supply electricity on demand during the day and through the night.
The CSP tower to be built at the site is reportedly the world's tallest CSP Tower, at 260m.
Chairman of SEGC, Zheng Jianhua, said: "This project presents an opportunity for China, UAE and KSA to cooperate, promote and benefit in energy and infrastructure development based on each parties' advantage in equipment manufacturing, engineering, construction & infrastructure, financing, project development and project management."
The fourth phase of the Mohammed Bin Rashid Solar Park is set to save 2.4 million tons of CO2 and half a million tons of natural gas per year, eliminating the need to use foreign currency to import this gas by substituting it with clean and renewable energy.