• What methods would you use to provide ACWA Power with a competitive edge in the Middle East solar market? How would ACWA Power tackle the market’s competitive environment?
First, our optimized business model which includes the development, investment and operation of a project encompasses the entire lifecycle of an asset.
We develop projects, invest in them, and operate them, while continuously looking into how we can optimize their financial structures to allow us to allocate and extract returns across the lifecycle of the asset.
We are a significant long-term developer, investor and operator delivering enduring sustainable tariffs in our markets and we use our expertise, knowledge, and know-how to optimize all aspects of each single project. We achieve this through Innovation to start with, we are technology agnostic, and we are open to implementing the most innovative technologies to improve the performance, reliability and LCOE of our projects.
We have strong cooperation with different Universities and R&D organizations. For example, in 2019 we partnered with King Abdullah University of Science and Technology (KAUST) to pursue goal-oriented research aimed at achieving further cost efficiencies in producing desalinated water and generating solar power. Through this collaborative effort, we installed solar PV pilot plants to test different PV modules and plant configurations. This has enabled us to develop new simulation tools to understand better bifaciality gain and other features from our potential configurations in our commercial projects.
Then, during the business development stage, we use numerous innovative solutions, optimizing every single angle of the projects. Thanks to the strong connections our company has established with major solar vendors (modules, trackers, inverters,) we are able to secure highly competitive pricing for top quality products in the market. Also, we foster strong relationships with our EPC partners (engineering, procurement, and construction), collaborating from day 1 to achieve project targets in terms of cost, quality and timelines.
We consider all market and technology inputs to optimize plant configuration and specifications, applying lessons learned from past projects to improve performance and reliability and achieve the lowest possible LCOE (levelized cost of electricity). Another key aspect is our standardized operating model (through NOMAC, solely owned subsidiary of ACWA Power). This allows us to operate our plants to the highest global standards with strong use of digitalization to improve asset performance. This said, in such a competitive environment, let’s not forget that our priority is always safety first! We are committed to protecting the well being of our employees, partners, plants, and the communities in which we operate
• How would you encourage sustainable practices and environmental stewardship at ACWA Power’s solar projects in the Middle East Given the growing emphasis on sustainability and mitigating climate change?
Towards a more sustainable world, ACWA Power reliably and responsibly produces enough power and desalinated water to meet the needs and cover the electricity and water consumption of more than 100 million people. It is a massive undertaking across 12 different countries, where we collaborate closely with governments and ministries to support their economic development to help them achieve their own goals to transition to a cleaner, greener future. If we focus our attention to our home country, ACWA Power is now actively delivering large scale renewable energy projects for the Kingdom of Saudi Arabia, which has prioritized creating a more diverse and sustainable economy as a major pillar in Saudi Arabia’s Vision 2030. We believe we are well positioned to leverage our early-mover advantage in the green hydrogen domain to develop several other strategic opportunities within and beyond Saudi Arabia and position ACWA Power as one of the key providers of state-of-the-art renewable solutions strongly integrated with green hydrogen production. We started our first renewable projects with Concentrated Solar Power (CSP) developing projects in South Africa and Morocco, then our first Solar Photovoltaic (PV) project was awarded in Dubai in 2015. From then on, several other solar projects have been developed, executed, and started operations. As of now, 41% of our energy comes from renewable sources. And by 2050, we intend to reach our net zero goals. To lessen our carbon footprint, ACWA Power decided to halt the development of coal plants to reduce emissions footprint and our emphasis is currently on renewables.
Regarding the procurement process, the environmental, social, and economic consequences of our procurement practices and raw material sourcing are evidently considered. The operating principles of the procurement process, its standards for application, and the duties and responsibilities of individuals participating in procurement are outlined in our procurement policy and the accompanying procedures. The Policy also applies to any third-party organizations using funds provided by ACWA Power, ensuring that any organizations we work with, including contractors, consider the environmental, social, and economic effect of their procurement processes.
Another important aspect of sustainability is local content and local community development. In this regard, driving community impact ACWA Power has always considered itself to be an integral member of the communities in which it operates. We are fully committed to community development, social responsibility sustainable livelihoods.
• Can you give examples of former utility-scale solar projects that you oversaw and include information about their scope, schedules, and results?
In term of solar utility scales, we can have many successful stories about development, execution, and operation, but if I need to highlight one project it would be Noor Energy 1 project in Dubai due to the complexity and magnitude of the project. Noor Energy 1 is a hybrid solar project which operates day and night delivering clean energy to Dubai.
The project is 700 MWe CSP divided into four units (1 x 100 MWe central tower technology and 3 x 200 MWe parabolic trough technology), where we have auxiliary PV plants to provide auxiliary load consumption during the day for CSP units and 250 MW PV plant full dispatch to the grid. The total power of the project is 950 MWe net and can generate up to 700 MWe during the night thanks to the thermal storage in CSP. This project has several world records, amongst which is the largest CSP project in the world. During 2022, the project initiated the commercial operation of PV full dispatch to the grid plant, and beginning in 2023, the first 2 CSP units achieved commercial operation.
This is an excellent illustration of how ACWA Power can integrate several renewable technologies while optimizing them in a single area to provide the lowest LCOE to our clients. 7.3 cents per kWhe is the lowest solar project rate for a 24-hour generation project. Another great example is our first commercial PV utility scale project, Shuaa Energy project (DEWA phase 2) in Dubai. This project is a part of the Dubai Integrated Energy Strategy 2030. This project demonstrated the declining costs of Solar PV technology, making it more cost competitive when compared to conventional energy such as natural gas.
The project started operation in Q1 2017. The performance and reliability of the plant have been very successful since its first day of operation. And finally, it is important to mention as part of our solar history, the first utility-scale PV project in KSA. The 300 MW Sakaka IPP photovoltaic (PV) solar project is the first ever utility-scale renewable energy project developed under the National Renewable Energy Program of Saudi Arabia. The Renewable Energy Projects Development Office (REPDO) awarded ACWA Power the contract at a world record-breaking tariff of US Cents 2.3417/kWh at that time. The project was the largest solar PV project built by ACWA Power at that time. The commercial operation date started in Q2 2020. The project performance is very successful and meets expectations.
• Can you describe your plans for ACWA Power’s Middle Eastern large-scale solar portfolio and how they will fit with the company’s long-term goals and broader commercial objectives?
Since its founding in 2004, ACWA Power has grown consistently, achieving 45.85 GW of power plants and 6.8 Mm3/day of desalinated water plants. These numbers are remarkable for a business with less than 20 years of existence… Despite these impressive numbers, ACWA Power expects growth to pick up steam between now and 2030. The amount of GW that will be added to our portfolio would then be enormous, with most of them being made up of renewable energy. They will primarily be PV solar, but we will also have other renewable technology like wind to support this expansion. The growth targets of the company are aligned with the deployment of solar PV and renewable energy in the coming years. Clean energy is the future to preserve our environment and our planet for the generation to come and ACWA Power is proud to work to these sustainable global objectives