Dubai Electricity and Water Authority (DEWA) has reached financial closure for the 2,400 MW Hassyan clean coal power project.
The total project investment is US$3.4 billion with limited recourse project financing split into a combination of senior secured financing and a secured mezzanine tranche.
The banks and financial institutions involved included: Industrial and Commercial Bank of China, Bank of China, Agricultural Bank of China, China Construction Bank, Silk Road Fund, First Gulf Bank, Union National Bank, Standard Chartered Bank, National Commercial Bank, Commercial Bank International and Emirates NBD. They have signed a US$2.47 billion financing.
The project uses the Independent Power Producer (IPP) procurement model on a Build Own Operate (BOO) basis and is supported by a 25-year Power Purchase Agreement (PPA) with DEWA. Last June, DEWA signed the PPA, Shareholders Agreement (SHA), and other project agreements with the consortium led by ACWA Power.
Hassyan Energy Company, which is a joint-venture between DEWA (51%) and a consortium comprising ACWA Power, Harbin Electric, and the Silk Road Fund (49%).
The project will use clean coal as feedstock for electricity generation. The new clean coal fired power generation facility, with an aggregate capacity of 2,400 MW, will be located at the Saih Shuaib area on the Arabian Gulf coast in the Emirate of Dubai. DEWA also plans to carry out an additional phase for a total capacity of 3600 MW.
The first 2,400 MW phase of the project comprises four 600 MW units. They will be operational in March 2020, March 2021, March 2022, and March 2023 respectively.
The second 1,200 MW phase of the project includes two 600 MW units with ultra-supercritical technology. The project is expected to begin commercial operation in March 2023.
HE Saeed Mohammed Al Tayer, MD & CEO of DEWA, said:
“The Hassyan clean coal power project underlines DEWA’s commitment to achieving the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, to diversify the energy mix. It also reflects DEWA’s commitment to achieving the Dubai Clean Energy Strategy 2050, which focuses on producing electricity from clean coal as part of Dubai's energy mix. DEWA works to achieve the fifth pillar of the Dubai Clean Energy Strategy 2050, which focuses on creating an environmentally-friendly energy mix, with 25% from solar energy, 7% from nuclear power, 7% from clean coal, and 61% from gas by 2030. DEWA continuously develops its electricity services by working to expand its projects, services, and facilities. DEWA’s future objectives aim to increase the efficiency and accountability of its infrastructure, to actively contribute towards the economic growth and prosperity of Dubai.”