Saudi energy firm ACWA Power has inked a power purchase agreement worth SR985.13mn ($262.7mn) with Uzbekistan's National Electric Grid for the Nukus2 200-megawatt wind project. This deal marks a step in Uzbekistan's renewable energy ambitions.
Structured as a public-private partnership, the 25-year agreement includes provisions for the installation of a battery energy storage system, enhancing the stability and reliability of the power supply in the Central Asian nation. ACWA Power revealed that the contract follows the build, own, operate, and transfer model.
While the financial impact of the project is anticipated to manifest after the first half of 2026, ACWA Power emphasized that the project is currently in the development phase. The total investment value, it cautioned, may be subject to changes upon reaching financial closure.
This venture builds upon ACWA Power's ongoing commitment to sustainable energy initiatives in Uzbekistan. In November 2023, the company embarked on the first phase of a green hydrogen project in the country, inaugurated by Uzbekistan’s President Shavkat Mirziyoyev and Saudi Minister of Investment Khalid Al-Falih. Mohammad Abunayyan, founder and chairman of the board of directors at ACWA Power, expressed gratitude for the trust bestowed by Uzbekistan's leadership, hailing the project as a milestone in the nation's energy revolution.
The Nukus2 project is set to be developed in two phases. The first phase involves a 3,000-tonne green ammonia pilot project, which is already underway following the signing of hydrogen purchase and power purchase agreements in May 2023. Upon completion of the second phase, 2.4 gigawatts of wind energy will drive the production of 500,000 tonnes of green ammonia annually.
ACWA Power underlined that Uzbekistan holds significance as its second-largest market in terms of investments. The company's portfolio in the country includes 12 projects, with 11 of them being fully renewable.
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