Uzbekistan, in partnership with the World Bank Group and Abu Dhabi Future Energy Company (Masdar), has secured a financial package to fund a 250-megawatt (MW) solar photovoltaic plant accompanied by a 63-MW battery energy storage system (BESS). This pioneering project aims to provide clean and reliable electricity to approximately 75,000 households.
The financial package for this project includes a $53 mn loan from the International Finance Corporation (IFC) and additional loans totaling $106 mn from the Asian Development Bank (ADB), Dutch Entrepreneurial Development Bank (FMO), and Japan International Cooperation Agency (JICA). These funds will support both the construction and operation of the new plant. Additionally, IFC will provide interest rate swaps for the entire debt amount to manage interest rate risks effectively.
The World Bank is also contributing with a $12 mn guarantee to back the government’s payment obligations under the project. Further, the investment package includes concessional senior loans of $20 mn each from the Canada-IFC Blended Climate Finance Program and the ADB-managed Leading Asia’s Private Sector Infrastructure Fund (LEAP).
IFC played a crucial role as the lead transaction advisor, collaborating with the Uzbek government to ensure a transparent and competitive tender process. In December 2022, Masdar, a leading renewable energy company from the United Arab Emirates, was announced as the winning bidder for the public-private partnership (PPP) tender.
“Our growing partnership with Uzbekistan in renewables is bringing clean and sustainable energy to the population at competitive prices. The new solar plant with a battery energy storage system will not just boost the uptake of renewable energy in the country but also help stabilize and strengthen existing electricity grids and aid the global fight against climate change,” said Wiebke Schloemer, IFC Director for Türkiye and Central Asia.
“This project will enhance Uzbekistan’s energy security through the use of innovative solutions and technologies. In addition to attracting private sector participation, the World Bank guarantee has also contributed to ensuring an affordable supply of renewable energy for households and businesses in the country,"
noted Marco Mantovanelli, World Bank Country Manager for Uzbekistan.”
The solar power plant project will be executed by Nur Bukhara Solar PV FE, a project company owned by Masdar. This company is responsible for the development, financing, construction, ownership, operation, and maintenance of the solar plant and BESS. Electricity generated by the project will be sold to the state-owned National Electric Grid of Uzbekistan under a 25-year Power Purchase Agreement, including a 10-year operating term for the BESS component.
The World Bank and IFC have been instrumental in launching several renewable energy projects in Uzbekistan, including a 100MW solar power plant in the Navoi region, operational since 2021, and ongoing projects in Samarkand and Jizzakh regions totaling 440MW. Additionally, the first 500-MW wind power plant in the Navoi region is under construction. With the new project in the Bukhara region, the renewable energy generation capacity supported by the World Bank Group will increase to approximately 1.3 gigawatts.
Over the past decade, IFC has invested in 16.9 GW of renewable energy capacity in emerging markets, facilitating the clean energy transition and enhancing electricity access. During this period, IFC has invested $12 bn from its own account and mobilized an additional $20 bn for energy projects in emerging markets. IFC continues to support the expansion of clean energy solutions and the deployment of transformative technologies like offshore wind, battery storage, distributed generation, off-grid solar, and green hydrogen.
About the Canada-IFC Blended Climate Finance Program: This program aims to mobilize private capital for global climate action, reflecting Canada's commitment under the 2015 Paris Agreement to support developing countries in transitioning to sustainable, low-carbon economies.
Abu Dhabi Future Energy Company (Masdar) is a leader in renewable energy and green hydrogen technologies, advancing global sustainability. Established in 2006, Masdar has partnered on projects in over 40 countries and aims to reach a renewable energy portfolio capacity of at least 100 GW by 2030. Masdar is jointly owned by Abu Dhabi National Oil Company (ADNOC), Mubadala Investment Company (Mubadala), and Abu Dhabi National Energy Company (TAQA).
Earlier Daryo reported that the Asian Development Bank (ADB) and Abu Dhabi Future Energy Company, Masdar, have inked a $46.5 mn loan agreement to build the Nur-Bukhara solar power plant and a battery energy storage facility in Uzbekistan's Bukhara region. This initiative marks Central Asia's first renewable energy project featuring a utility-scale battery energy storage system.
Comments (0)