Abu Dhabi National Energy Company (TAQA) from the UAE, Japan’s largest power producer JERA, and Al-Bawani Financial (Al-Bawani), a subsidiary of Al-Bawani Holding, a Saudi group active in construction and development, announced the closing of a financial deal to fund the construction of two new power plants in Saudi Arabia.

The UAE official news agency reported on Wednesday that the two plants are “Rumah 2” under the company “Rehab Al-Awwal Energy”, and “Al-Nairyah 2” under the company “Nours Energy”.

This important phase was completed under the supervision of the Saudi Ministry of Energy in partnership with the Saudi Power Procurement Company, following the signing of two 25-year power purchase agreements for each plant among the partners TAQA, JERA, and Al-Bawani.

The two new plants will use combined cycle gas turbines to generate a total capacity of 3.6 gigawatts of electricity. The project is implemented under a build-own-operate model and will support efforts to meet the growing energy demand in the Kingdom.

The total investment required to build the two plants is approximately $4 billion (about 14.7 billion AED). Financing was secured from a consortium of leading regional and international banks through senior debt and equity loans, with a debt ratio exceeding 80%, reflecting the strong fundamentals of the project and the confidence of lenders, including Al Rajhi Bank, Riyadh Bank, Saudi British Bank, National Commercial Bank, Arab Petroleum Investments Corporation, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Bank of China, and First Abu Dhabi Bank.

The plants will be established through special purpose companies with ownership shares distributed among the partners as follows: TAQA 49%, JERA 31%, and Al-Bawani 20%.

Operation and maintenance will be handled by other private companies according to the same ownership shares. Engineering, procurement, and construction contracts for both plants were awarded to Harbin Electric International Limited and China Taisei Civil Engineering Limited.

The plants will be equipped with the latest high-efficiency combined cycle gas turbines, with future readiness for carbon capture technologies to support the Saudi Ministry of Energy’s carbon capture goals outlined in Saudi Vision 2030.

The projects also align with the Saudi Green Initiative’s ambition for net-zero greenhouse gas emissions by 2060 within a circular carbon economy framework.

The consortium selected Siemens Energy as the main equipment manufacturer, with long-term service agreements signed with the operation and maintenance companies.

The projects support Saudi Arabia’s ambitions to enhance its energy mix and meet growing energy demand.

Fares Al-Olaqi, CEO of Power Generation and Water Desalination at TAQA, said the deal closing is an important step forward in advancing the development of the two plants, cementing TAQA’s position as a preferred business partner for world-class utility projects. As the main developer, TAQA will leverage its global capabilities and expertise to support the Kingdom’s ambitions to produce an optimal energy mix.

He noted that construction work is progressing steadily with the completion of the initial works phase recently, and the plants are being developed to meet future aspirations by equipping them with high-efficiency combined cycle gas turbines, reaffirming a firm commitment to growth and decarbonization.

Stephen Wynn, Head of Global Project Strategy at JERA, welcomed the financing deal for the two plants under the power purchase agreements and financing agreements with key financiers, reflecting JERA’s extensive capabilities and global experience in successfully developing projects of this scale.

He added that the project will strengthen JERA’s presence in Saudi Arabia and contribute to supporting the Kingdom’s efforts to ensure reliable and sustainable energy supplies. The plants will also have future carbon capture capability, aligning with JERA’s goal of achieving climate neutrality by 2050.

Fakhr Al-Shawaf, CEO of Al-Bawani Holding, said this achievement marks a milestone in Al-Bawani’s journey and its support for the energy transition in the Kingdom in line with Vision 2030. Through its partnership with TAQA and JERA, these strategic projects will provide sustainable energy solutions contributing to growth and economic prosperity in Saudi Arabia.