The Emirates Water and Electricity Company (EWEC), affiliated to Abu Dhabi Power Corporation, has received the world’s lowest tariff bid for a solar power project.
The 2GW solar photovoltaic (PV) independent power producer (IPP) Al Dhafra project – to be located in Abu Dhabi – has received, from the first-ranked bidder, a tariff offer set at AED 4.97 fils per kWh ($1.35 cents per kWh), which is approximately 44% lower than tariff set three years ago for the 1.7GW Noor Abu Dhabi project, one of the world’s largest solar PV projects and a world record tariff-setter at the time.
Othman Al Ali, CEO of EWEC, said, “Securing such competitive tariffs for our energy projects is fundamental to support economic growth across all sectors in the UAE. We look forward to signing the power purchase agreement [of the plant] and to delivering the project in the second quarter of 2022.”
In July 2019, EWEC received 48 expressions of interest from potential bidders in respect of the Al Dhafra project, out of which 24 bidders were qualified to bid for the project after submitting Statements of Qualification. In November 2019, five bids were shortlisted for the project, comprising ACWA Power, EDF and International Power Energy alliance, Total and Marubeni Solar alliance, Softbank Energy Global, and Eni.
An official at EWEC said that the company will start negotiating the power purchase agreement with the first-ranked bidder soon.
The UAE accounts for 4% of the global oil production, mostly from oil fields in Abu Dhabi. The emirate has a plan of having 50% of its energy needs served from renewable and clean energy sources by 2030. Once operational, the Al Dhafra Solar PV project will lift Abu Dhabi’s total solar power generation capacity to approximately 3.2GW.