The Asian Development Bank (ADB) and Saudi Arabia’s ACWA Power Company (ACWA) have signed $174 million worth of loans to develop the Bash wind power and Dzhankeldy wind power plants, both located in the Bukhara region in Uzbekistan.
The financing comprises loans amounting to $40.5 million for Bash and $46.5 million for the Dzhankeldy funded through ADB’s ordinary capital resources. The ADB will also administer $40.5 million for Bash and $46.5 million for Dzhankeldy from the Leading Asia’s Private Infrastructure Fund (LEAP), administered by ADB.
Each power plant consists of 79 wind turbines, for a total of 158 turbines that will generate 3,235 gigawatt-hours and displace 2 million tons of carbon dioxide equivalent a year. Together, Bash and Dzhankeldy will be the largest utility-scale wind power development in the Central West Asia region. The loans will also fund the construction of 282.5 km of 500-kilovolt, single-circuit overhead transmission to connect to the power grid.
Growing Energy Demand
ADB’s Director General for Private Sector Operations Suzanne Gaboury said that Uzbekistan is one of the fastest-growing economies in Central Asia, and with it comes a growing demand for energy.
“This brings a unique opportunity to invest in decarbonization and expansion of renewables in the country’s energy mix. Bash and Dzhankeldy are landmark greenfield wind power projects which have a significant demonstrative impact of private sector participation across the region’s energy sector,” Gaboury said.
ADB has supported approximately 2,500 megawatts of renewable energy in Uzbekistan since 2019, after the country opened the sector to private sector participants. The total cost of ADB’s latest collaboration with ACWA is approximately $1.35 billion.
Parallel lenders include the Deutsche Investitions- und Entwicklungsgesellschaft mbH (DEG), European Bank for Reconstruction and Development, OPEC Fund for International Development, and Proparco.
LEAP is an ADB-managed fund capitalized with a $1.5 billion commitment by the Japan International Cooperation Agency (JICA).
Established in 2016, LEAP focuses on delivering high-quality and sustainable private sector infrastructure projects that reduce carbon emissions, improve energy efficiency, and offer accessible and affordable health care, education, and communication services to ADB’s developing member countries.
Bash and Dzhankeldy are SPVs
Bash and Dzhankeldy are special-purpose vehicles owned by ACWA Power, a regional leader in renewable energy. ACWA was established in 2008 and is a developer, investor, and operator of power generation and desalination plants, with 67 assets in operation, construction, or advanced development across 13 countries. ACWA’s portfolio has a capacity of 43.4 gigawatts of power and 6.4 million cubic meters per day of desalinated water.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members including 49 from the region.
Last month, ACWA Power – owned by Saudi Arabia’s Public Investment Fund – signed agreements worth $2.5 billion with the National Electric Grid of Uzbekistan to develop three solar photovoltaic projects in Toshkent, Bukhara, and Samarkand regions of the country.
The contracts also include three battery energy storage systems with a total combined capacity of 1,500 megawatts.
In August 2022, ACWA Power revealed Uzbekistan was the largest market for its investments outside of Saudi Arabia. This came as the company signed three final agreements with the Central Asian country to establish a power station with a capacity of 1.5 GW, with investments amounting to $2.4 billion.