RIYADH: Saudi Arabia has stepped up its efforts in building the world’s largest solar project with the ACWA Power-led consortium finalizing the financing for Al-Shuaibah 1 and Al-Shuaibah 2 at a total investment of SR8.3 billion ($2.2 billion) through a mix of long-term debt and equity. 

ACWA Power announced this through a bourse filing on Sunday and said the total financing consists of SR6.1 billion in senior debt, including a SR1.7 billion loan from the National Development Fund on behalf of the National Infrastructure Fund. 

It is in addition to a SR4.4 billion US-dollar commercial facility from a consortium of local, regional and international banks, including Bank Saudi Fransi, First Abu Dhabi Bank and Mizuho Bank. 

The other banks in the consortium comprise Riyad Bank, the Saudi National Bank, Standard Chartered Bank and Saudi Investment Bank. 

In November, ACWA Power signed power purchase agreements with the Water and Electricity Holding Co., also known as Badeel, to develop the solar plant with a capacity to power 350,000 homes. 

The 2,060 megawatts solar photovoltaic plant is expected to begin commercial operations by the fourth quarter of 2025.  

According to the statement to Tadawul, the consortium included the Public Investment Fund unit Badeel and the Saudi Arabian Oil Co., with ACWA Power holding a 35 percent equity stake. 

The project is part of Saudi Arabia’s energy transition strategy, demonstrating how giga-scale development in sustainable energy will be significant in implementing Vision 2030 goals.    

The PIF aims to develop 70 percent of the Kingdom’s renewable energy capacity by 2030. 

“We expect investment in clean energy projects to rise, assisted by high oil prices in 2023‑24, as Saudi Arabia seeks to add 15 GW of renewable energy capacity in 2022‑23, supporting the government’s climate objectives and economic diversification strategy,” the Economist Intelligence Unit said in its assessment of the project in February. 

The report added: “We expect that Saudi Arabia will exploit current oil windfalls to accelerate its clean energy transition in 2023‑27 as the government aims to invest a total of SR380 billion in a bid to raise renewable energy to 50 percent of power‑generating capacity (about 58.7 GW) by 2030.”