Latest news with #ACWAPowerCo.
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Business Standard
3 days ago
- Business
- Business Standard
Saudi Arabia rapidly losing appetite for oil amid renewables push
You know that horror movie trope where the babysitter gradually realises the crazed killer is phoning, not from some distant location, but from inside the house? Something similar is happening in the oil market. That's because Saudi Arabia, the world's biggest net exporter of crude, is using renewables to drastically reduce its petroleum consumption. The threat to the kingdom's producers isn't coming from the heartlands of electric vehicle adoption in Shenzhen, Oslo, or San Francisco — it's right inside the house. Between a quarter and a third of the country's consumption goes into crude- and fuel oil-fired generators that provide electricity to ride out summer heatwaves. The government wants to replace all of that with renewables, with a target of 130 gigawatts by 2030 — roughly equivalent to all the solar power in India. Such a switch could represent the single largest decline in oil demand over the next five years, according to the International Energy Agency. It's not news that the country has such ambitions. One of the cornerstones of Vision 2030, the program announced in 2016 to wean the kingdom's economy off hydrocarbons, was to switch the grid to an exclusive gas-renewables mix. However, such bold pronouncements are typically heavily discounted where Saudi Arabia is concerned. This is a country that's been working on an unfinished one-kilometer (0.62 mile) skyscraper since 2013, and recently called in consultants to review the feasibility of The Line — an implausible science fiction city being built to house nine million people inside a 170 kilometer-long tower. Kpler, a data company that tracks commodities flows, reckons only 11.6 GW of the planned 130 GW will be online by 2030. Such a serious shortfall would be enough to sustain crude in power generation well into the future. It might be time to start reevaluating whether that skepticism is warranted, however. There's certainly a huge gap between promise and execution where the kingdom's megaprojects are involved. Still, when it comes to building humdrum energy infrastructure (as opposed to, say, a cube-shaped hollow tower as tall as the Empire State Building), one of the world's biggest petroleum producers has a decent track record. That's now finally showing up not just in wells and export facilities, but in renewables, too. After years in which the only major solar project connected was a relatively modest 0.3 GW plant in the deserts between Jordan and Iraq, generators are now being plugged in at a rapid pace. Since the start of 2024 alone, ACWA Power Co., the country's biggest electricity and water developer, started commercial operations at four solar facilities totaling about 4.9 GW. Roughly the same amount is due to start up by the end of next year, the company told investors recently, shortly after completing a 7.125 billion riyal ($1.9 billion) capital raising. Last month, it signed deals with Saudi Arabia's main utility to build another 15 GW, to be delivered by the middle of 2028. The broader plan is for ACWA to hit 78 GW by 2030, sufficient on its own to provide all the electricity that Saudi Arabia generated from oil last year. Much more is in the pipeline from other developers. With ACWA giving investors detailed timelines of further near-term completion dates, the onus is increasingly on the skeptics to explain why the recent run of successful project execution is going to be broken. Thanks to abundant sunlight, Saudi solar plants deliver electricity at less than half of the cost of the grid. Arrays of panels also tend to be much more simple, in engineering terms, than the petroleum extraction, transport and refining complexes in which the kingdom has long excelled. Getting those renewables built is also crucial for the country's overriding obsession: its position in the oil market. One justification given by Saudi Arabian Oil Co. President Amin Nasser for cutting back maximum output capacity last year was that removing crude from the domestic grid would boost exports as effectively as drilling extra wells. The plans to eliminate oil from the grid by 2030 are still 'on track,' he told Aramco investors last week. Saudi Aramco's competitors might want to reflect on that. For Nasser, the country's transition is reason enough to trim investments intended to meet hypothetical future demand. The kingdom's grid uses more oil than all the cars and scooters in India. If such an enormous consumer of the world's crude is going away by the end of the decade, an already oversupplied market risks heading still deeper into glut.
Argaam
22-04-2025
- Business
- Argaam
ACWA Power secures SAR 750M loan from Alinma Bank for new headquarters
ACWA Power Co. announced that it has secured a SAR 750 million loan from Alinma Bank to finance the construction of its new headquarters in Riyadh. According to a company statement, the term of the Sharia-compliant financing facility extends over a period of seven years. The new headquarters will be built according to an advanced model of the highest standards of sustainable construction, including the application of "zero emissions" requirements to reduce the environmental footprint, the company said.
Argaam
06-04-2025
- Business
- Argaam
ACWA Power starts commercial ops at Uzbekistan's 2 wind power plants
ACWA Power Co. received notifications, on April 3, from the project companies of both the 500 megawatts (MW) Dzhankeldy Wind Farm and the 500 MW Bash Wind Farm in Uzbekistan, confirming the issuance of commercial operation certificates for their full production capacity, according to a Tadawul statement.
Argaam
20-02-2025
- Business
- Argaam
ACWA Power, SEC sign SAR 13.4B PPA for Qurayyah station project
Qurayyah IPP Power Project Saudi Electricity Co. and ACWA Power Co. signed on Feb. 19. a power purchase agreement (PPA), with Saudi Power Procurement Co. (SPPC) – the primary buyer – to purchase power for Qurayyah IPP Power Project expansion project using a combined cycle system. In separate statements on Tadawul, the two parties stated that the project, located in Saudi Arabia's Eastern Province, has a production capacity of 3,010.3 megawatts and is prepared for the construction of a carbon capture unit. The contract is valued at SAR 13.4 billion, with each company holding approximately a 40% stake in the project. The contract duration is 25 years, starting from the anticipated commercial operation date of the entire plant. The contract covered the development, financing, construction, ownership, and operation of a gas-fired power plant utilizing a combined cycle system, as well as the development, financing, construction, and then transferring ownership of a 380-kilovolt transformer station. Both parties stated that the financial impact will be determined upon the completion of the financial closing, expected in the second quarter of 2028. They also noted the presence of related parties to the agreement, represented by the two companies.
Argaam
19-02-2025
- Business
- Argaam
ACWA Power acquires power generation, water desalination assets worth SAR 2.6 Billion
ACWA Power Co. signed an agreement to complete the acquisition of power generation assets (4.6 GW combined cycle) and water desalination assets (1,114k m3/day), along with related operation and maintenance companies, from Kahrabel FZE, a subsidiary of the French company Engie, in both Kuwait and Bahrain, with a total value of SAR 2.59 billion (USD 693 million).
