Abu Dhabi National Energy Company, known as Taqa, and Emirates Water and Electricity Company (Ewec) have reached financial close on the Dh3.6 billion ($980 million) Al Dhafra power plant that will supply electricity to data centre projects in the UAE.
The project, which has a total capacity of 1 gigawatt, is 85 per cent funded through debt financing, with local and international banks supporting the deal, Taqa said in a statement to the Abu Dhabi Securities Exchange on Tuesday, where its shares are traded.
Standard Chartered Bank, Abu Dhabi Commercial Bank, the Agricultural Bank of China, Doha Bank, First Abu Dhabi Bank and HSBC are among the banks involved in the transaction.
ICBC (Industrial and Commercial Bank Bank of China), Germany’s KFW, National Bank of Kuwait, RAK bank, Woori Bank, Abu Dhabi Islamic Bank, Boubyan Bank and Ajman Bank are the other lenders.
The financial close of this project comes after Taqa, which is building the project, signed a 24-year Power Purchase Agreement with Ewec in April. Taqa also owns and operates the gas-fired power plant, with construction work already under way.
“AI represents a major opportunity for both economic growth and increased energy demand,” Frank Possmeier, chief investment officer, Taqa’s generation business, said.
“Meeting this demand requires an agile, secure and sustainable energy mix that prioritises decarbonisation and flexibility. The Al Dhafra gas turbine power plant exemplifies this approach.”
The UAE is developing artificial intelligence infrastructure as the use of the advanced technology increases across different sectors. One such initiative is Stargate UAE, a major AI infrastructure project in Abu Dhabi.
Stargate UAE is being developed by Khazna Data Centres, a G42 company, alongside OpenAI, Oracle, Nvidia, Cisco and SoftBank, within the 5 gigawatt UAE-US AI Campus in Abu Dhabi.
“The flexible baseload power that will be delivered by this plant complements our growing pipeline of utility-scale renewables and battery storage, providing the essential transitional capacity needed to integrate significantly higher levels of clean energy into the grid,” Mohamed Almarzooqi, chief asset development and management officer at Ewec, said.
Taqa boosting its portfolio
In October, the UAE broke ground on a Dh22 billion renewable energy project in Al Wathba in Abu Dhabi, which will include a solar power plant with a battery energy storage system (BESS), and is scheduled to become operational in 2027.
BESS solutions provide flexible energy to the grid by storing electricity in batteries during periods of low demand and releasing it at peak times. The technology helps to balance and stabilise the intermittent supply from renewable sources.
Taqa is targeting 150 gigawatts of gross power generation capacity by 2030 through its own projects and its 43 per cent stake in Abu Dhabi’s renewable energy company Masdar, the company said.
Last month, Taqa, in partnership with Dubal Holding, also announced plans to acquire Emirates Global Aluminium’s water and power generation assets in Al Taweelah for $1.9 billion as part of efforts to boost clean energy development in Abu Dhabi.
The acquired assets will be held under a joint venture, with the ownership shared equally between Taqa and Dubal, while operations will be managed by a new company jointly owned by Taqa and EGA.
Al Taweelah power plant, with a capacity of 3.1 gigawatts, is the third largest in Abu Dhabi. It also has a desalination capacity of 23.6 million litres per day.
Taqa is also expanding its global portfolio. In August, the company agreed to acquire Spanish water treatment and water desalination company GS Inima for $1.2 billion to expand its water business.
In April, the company also announced plans to acquire the UK’s Transmission Investment, one of the largest operators of assets connecting offshore wind farms to the British electricity grid.
Separately, Taqa and Abu Dhabi's sovereign wealth fund Mubadala completed the acquisition of a gas-fired power generation plant at the Talimarjan Power Complex in Uzbekistan in May.
