ACWA Achieves FC for 240 MW Wind Power Plant in Azerbaijan

ACWA Power, the developer, investor and co-owner which operates a portfolio of power generation, renewable energy and desalinated water production plants in Saudi Arabia, has achieved financial close for a $238 million senior debt facility to finance the 240 MW- Khizi-Absheron Wind Power Plant in Azerbaijan.

According to a report in Argaam, the Arab world’s leading financial news portal, ACWA Power said that the senior debt facility for the project, provided by a consortium comprising the European Bank for Reconstruction and Development (EBRD) and the OPEC Fund for International Development.

 The utility also said that an initial equity financing option of $120 million was secured from First Abu Dhabi Bank (FAB), in compliance with Islamic Sharia in December 2023, the report said.

Commercial operations are expected to commence in the first half of 2026 and once commissioned, the project is set to supply energy to about 300,000 homes and reduce carbon emissions by over 400,000 tons annually. The project’s sole off-taker is Azerbaijan’s state-owned energy company, Azerenerji, under a 25-year power purchase agreement.

According to Argaam data, ACWA Power signed the official implementation agreements in December 2020 for the development, construction, and operation of the said project, with a total investment of $300 million.

ACWA, which Azerbaijan market in 2019 with the intention of supporting the Central Asian nation in meeting its ambitious renewables integration, greenhouse gas (GHG) emissions reduction, and decarbonisation targets, broke ground on the project two years ago and secured $120 million Shariah-compliant equity financing option from First Abu Dhabi Bank in December 2023.

Other Projects

ACWA Power is also on track to reach financial close on $7.99 billion in financing, its CEO Marco Arcelli told Al Arabiya on the side lines of COP29 in Baku, Azerbaijan. The financing is slated for projects in Saudi Arabia and elsewhere.

The firm is also eyeing a $7.1 billion capital increase by next year to support growth plans and has appointed financial advisors for the transaction, he said.

ACWA Power, which is listed on Saudi Arabia’s main market Tadawul signed four implementation agreements with the Azeri Ministry of Energy for mega and giga projects including a 1GW onshore, a 1.5GW offshore wind farm and a battery energy storage project in February 2023.

Argaam’s report said that The renewables giant is focusing on Central Asia due to its strategic position as a gateway for trade. ACWA Power has significant portfolios in Azerbaijan, Uzbekistan, and Kazakhstan and has earmarked some $15 billion for decarbonisation projects in the region, Arcelli said.

ACWA Power has also signed a Memorandum of Understanding (MOU) with Abu Dhabi Future Energy Company, MASDAR, and Azerbaijan’s state-owned company (SOCAR) to develop 500 MW of renewable energy projects in Nakhchivan Autonomous Republic in that country. The MOU will enable collaboration and exploration in the fields of renewable energy and green hydrogen.