The latest section of the Mohammed bin Rashid Al Maktoum Solar Park appears to have come within a whisker of setting a record low price for solar power.

The Dubai Electricity and Water Authority (DEWA) has finally confirmed Saudi energy company ACWA Power was the winner of the tender for the fifth phase of the huge Mohammed bin Rashid Al Maktoum Solar Park.

Media reports last month suggested the Saudi bidder was in prime position to secure the 900 MW tender and the tendering authority today confirmed the winning solar electricity price bid came within a whisker of a new world record – by today’s dollar-euro exchange rate, at least.

With a tender held by the Portuguese government at the end of July having generated a lowest solar power price of €0.0147/kWh – despite skepticism from at least one industry insider over whether it constituted a genuine representation of costs – DEWA yesterday confirmed it will pay ACWA $0.016953/kWh for the power generated from the 900 MW of project capacity allocated. At the exchange rate at the time of publication, that was the equivalent of €0.015/kWh.

The government of Dubai issued a press release identifying the winner as a consortium led by ACWA Power and the Kuwait-based Gulf Investment Corporation owned equally by the governments of Bahrain, Kuwait, Oman, Qatar, Saudi and the UAE.

Another phase allocated

“The 900 MW fifth phase of the solar park – using PV solar panels based on the IPP [independent power producer] model – will become operational in stages starting [in] Q2 of 2021,” said Saeed Mohammed Al Tayer, the chief executive of DEWA who was quoted in the statement. “The project documents, power purchase agreement (PPA) and financial close agreements will be signed in due course.”

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DEWA will sign a 25-year power purchase agreement and will hold a 60% stake in the project.

ACWA is already constructing phase II of the 5 GW solar field with Spanish engineering services provider TKS. French state utility EDF began work on the 800 MW solar section of Phase III in 2017, with a 200 MW slice of capacity going online in May last year. That part of the project will sell power to DEWA for $0.029/kWh.

Phase IV, originally intended to be a 700 MW concentrating solar power (CSP) plant and later expanded with 250 MW of photovoltaic capacity, is also being developed by ACWA. The PV section of that phase of the project will sell power for $0.024/kWh. For the CSP section, ACWA and DEWA agreed a rate of $0.073/kWh.

The Mohammed bin Rashid Al Maktoum Solar Park, which is also set to include large scale storage and hydrogen facilities, is scheduled for completion by 2030.