ACWA Power signs power purchase and investment agreements for 1.5GW wind plant in Uzbekistan

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  • ACWA Power signs Power Purchase Agreements (PPAs) and investment agreements through three wind power subsidiaries to develop the 1.5 GW Kungrad wind farm
  • The Kungrad wind farm, formerly referred to as Karakalpakstan Wind IPP, will be the largest single-site wind farm in Central Asia, and one of the largest in the world, when completed
  • Project is expected to be valued at US$2.4 billion to offset 2.4 million tonnes of carbon emissions per year and power 1.65 million households

Riyadh, KSA: ACWA Power, a leading Saudi developer, investor, and operator of power generation, water desalination and green hydrogen plants worldwide, signed on December 23, 2022, the power purchase agreements (PPAs) and investment agreements (IAs) with the government of the Republic of Uzbekistan to develop the 1.5 GW Kungrad wind farm in the republic of Karakalpakstan, Uzbekistan; formerly referred to as the Karakalpakstan Wind IPP. The wind farm shall comprise of three 500MW wind power projects owned by 3 subsidiaries, namely  ACWA Power Kungrad Wind 1 LLC FE, ACWA Power Kungrad Wind 2 LLC FE and ACWA Power Kungrad Wind 3 LLC FE.

Each of the 3 projects will also incorporate a 100MW capacity battery energy storage system.  Regarded as the largest single-site wind farm in Central Asia to date, and one of the largest of its kind in the world, the wind farm is expected to reach an investment value of USD 2.4 billion.

Previously, a Heads of Terms agreement signed between ACWA Power and Uzbekistan’s Ministry of Energy and Ministry of Investment & Foreign Trade in August 2022 laid the foundation on which the power purchase agreements and investment agreements for the facility were to be procured. The PPAs were signed by Rohit Gokhale, Executive Vice President, ACWA Power and Dadajon Isakulov, Chairman, National Electric Grid of Uzbekistan, JSC (“NEGU”); while the investment agreements were signed by Mohammad Abunayyan, Chairman, ACWA Power on behalf of ACWA Power, Rohit Gokhale, on behalf of the project companies, and His Excellency Jamshid Khodjaev, Deputy Prime Minister & Minister of Investment and Foreign Trade, on behalf of the Ministry of Investment and Foreign Trade (MIFT). The agreements were signed in the presence of His Excellency Khalid Al-Falih, Minister of Investment of Saudi Arabia, His Excellency Jurabek Mirzamakhmudov, Minister of Energy, Republic of Uzbekistan, and senior executives from ACWA Power and the Government of Republic of Uzbekistan.

 

Located in Kungrad district, Republic of Karakalpakstan, in Uzbekistan, the wind farm is expected to offset 2.4 million tonnes of carbon emissions per year and will have minimum environmental impact due to the utilisation of the latest mitigation technologies, including bird detecting technology, that combines cutting edge technology in both image sensors and software to prevent bird collision or fatality.

 

The Kungrad wind farm will bolster the Uzbek government’s long-term strategy to diversify the country’s energy mix, which targets 8GW and 12GW of solar and wind capacity by 2026 and 2030, respectively.

Jurabek Mirzamakhmudov, Minister of Energy of Uzbekistan, said: “It is my great pleasure to share an update on the progress of the Kungrad project. Uzbekistan is committed to delivering on policy goals to increase the renewable energy share of the country’s energy mix and reduce carbon emissions. The development of green energy and market reform go hand in hand in Uzbekistan, and the Kungrad project is a milestone both for our wind industry and the new public-private partnership model, introduced by the far-sighted reforms of President Mirziyoyev. The wind farm in Karakalpakstan, which will be built by our reliable partner ACWA Power, will be another pillar of a sustainable and reliable energy system in Uzbekistan.”

“We are deeply honoured to build upon our close partnership with the Republic of Uzbekistan as the nation continues to advance its decarbonisation efforts, pursuing a strong shift towards renewable energy. The signing of key agreements today for the landmark Kungrad wind farm project, which will set a new benchmark for sustainable energy development in the region, and the world, would have not been possible without the guidance of our visionary leadership and the trust and commitment of our partners from the Uzbek government,” said Mohammad Abunayyan, Chairman, ACWA Power. “We are proud to play a vital role in supporting Uzbekistan’s long-term renewable strategy, stemming from the strong international ties between Saudi Arabia and Uzbekistan, and remain committed to delivering clean energy at a low cost to ensure energy security and enable sustainable progress,” he added.

The project is expected to achieve financial close by 2024 and will be fully commissioned in 2027. When complete, the facility is expected to power 1.65 million households.

Additionally, under the US$10 billion investment cooperation agreement signed between ACWA Power and the Uzbek government in August 2022, ACWA Power formalised agreements for the development of large-scale green hydrogen facilities in the Republic of Uzbekistan. The aim of these projects is to reduce the country’s dependency on natural gas; significantly contribute to Uzbekistan’s decarbonisation goals; and further support research in the field of green hydrogen.

The 1.5GW Kungrad wind project is ACWA Power’s fifth project in Uzbekistan. The company’s Uzbek portfolio also includes three wind farms, and a combined cycle gas turbine project. Uzbekistan is the second largest country for ACWA Power in terms of overall investment.

ACWA Power remains focused on extending its leadership in high-growth markets through operational excellence and technological expertise, delivering power and desalinated water to communities in 12 countries worldwide.

About ACWA Power

ACWA Power (TADAWUL:2082) is a developer, investor and operator of power generation, desalinated water and green hydrogen production plants. Registered and established in 2004 in Riyadh, Saudi Arabia; ACWA Power employs over 3,900 people and is currently present in 12 countries in the Middle East, Africa, Central Asia and Southeast Asia. ACWA Power’s portfolio comprises 66 projects in operation, advanced development, or construction with an investment value of SAR 255.74 billion (USD 68 billion), with capacity to generate 44.6 GW of power and manage 6.2 million m3/day of desalinated water per day, delivered on a bulk basis to address the needs of state utilities and industries on long term, off-taker contracts under utility services outsourcing and Public-Private-Partnership models.

ACWA Power’s mission is to deliver electricity and desalinated water reliably and responsibly at a low cost, thereby contributing effectively to the sustainable, social and economic development of communities.