Image for illustrative purposes only. — File photo

The Abu Dhabi National Energy Company (Taqa), in collaboration with Jera Co, Japan’s largest power generation company, and Al Bawani Capital, a subsidiary of AlBawani Holding, a prominent contracting and development group, have signed two 25-year power purchase agreements (PPAs) with Saudi Power Procurement Company (SPPC). These agreements are for the development of two new greenfield combined cycle gas turbine (CCGT) power projects in Saudi Arabia, with a combined generation capacity exceeding 3.6 GW. The PPAs follow SPPC’s recent announcement of contract awards for the 1.8 GW Rumah 2 and 1.8 GW Al Nairyah 2 conventional independent power producer (IPP) projects to a consortium including Taqa, Jera, and AlBawani.

The Rumah 2 IPP and Al Nairyah 2 IPP will utilize the most efficient CCGT turbines available and will support the implementation of carbon capture technologies. These projects align with the kingdom’s energy mix objectives, aiming to meet power demand through an optimal energy mix of 50% renewable energy and 50% gas technology by 2030. Additionally, the plants are in line with the Saudi Green Initiative, which targets net-zero greenhouse gas emissions through the circular carbon economy by 2060, or earlier if necessary technologies become available.

The two new plants will be developed by special purpose entities owned by Taqa (49%), Jera (31%), and AlBawani (20%), with operation and maintenance (O&M) to be managed by the partners through O&M special purpose entities with the same shareholding structure. Farid Al Awlaqi, CEO of Taqa’s generation business, stated, “Taqa has ambitious growth targets of 150GW by 2030, and this announcement marks a significant milestone for 2024 with the addition of a further 3.6 GW of low-carbon gas-fired power capacity in Saudi Arabia.”

Steven Winn, Jera’s chief global strategist, added, “In line with Jera’s goal to achieve net zero by 2050, the award of these two high-efficiency independent power projects reinforces Jera’s commitment to decarbonising thermal power generation.” Fakher AlShawaf, Group CEO of AlBawani Holding, commented, “The partnership with Taqa and Jera on these state-of-the-art power plants marks a transformative milestone for AlBawani, reinforcing our commitment to advancing the kingdom’s energy diversification initiatives.”

Earlier this year, Taqa and Jera reached financial close on a new industrial steam and electricity cogeneration plant in Jubail, Saudi Arabia, which will produce electricity and steam for a petrochemical complex.

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