Korea’s EXIM Bank to Provide $150 Million to UAE’s 1.5 GW Solar project

In a big boost to the ongoing efforts of the UAE to promote solar energy, the state-owned Export-Import (EXIM) Bank of Korea on Monday announced that that it will provide $150 million in project financing for a major solar power generation project in the Emirates.

The EXIM Bank is an official export credit agency (ECA) providing comprehensive export loan and guarantee programs to support Korean enterprises conducting business overseas. Since its establishment in 1976, Korea Eximbank has actively supported Korea’s export-led economy and facilitated economic cooperation with foreign countries.

The total cost of the Ajban solar power project in the UAE is around $900 million. It is first of such to be undertaken by South Korea and upon its completion in 2026, the plant will be ranked as the seventh-largest solar power facility in the world.

This financial procurement comes after the state-owned Korea Western Power Co’s joint win of the bidding with EDF-Renewables, a subsidiary of Electricite de France, which will now fully organise the entire process of the project.

Korea Eximbank has long expressed its commitment to this project since the initial stages of the bidding process, through a letter of interest. The financing accounts for up to 16.67% of the total project cost of $900 million.

Through project financing, Eximbank will secure loan repayment from future cash flows generated by the project.

Set in the Ajban desert area, 70 km east of Abu Dhabi, this project stands as the largest solar power project in terms of both installed capacity and investment among those won by Korean companies.

Covering an area of 20 sq km, the plant will feature around 2.93 million solar modules, producing a total capacity of 1.5 GW.

The annual energy output is projected to be about 4500 gigawatt-hours, which can supersede the annual household electricity consumption of Incheon city, which is part of Seoul Capital Area in South Korea. The generated electricity will be purchased entirely by the UAE’s Emirates Water and Electricity Company (EWEC) for 30 years.

The Exim Bank said that countries in the Middle East, including the UAE and Saudi Arabia, are continuously initiating large-scale solar power projects as part of their carbon neutrality policies to combat climate change.

“We are committed to supporting our companies in securing subsequent projects in the fiercely competitive Middle Eastern market, thereby contributing to the global transition to green energy,” the bank said.

Last year, Korea Eximbank also issued a letter of interest to support Kowepo’s successful bid for the Manah 1 solar power project in Oman, which marked the first solar project in the Middle East won by a South Korean company.