Saudi Arabia to award first $500m wind farm project in December 2018

Four pre-qualified local and international companies had submitted bids for the 400MW Dumat Al Jandal project

Burbo Bank wind farm near New Brighton, Britain -- Saudi Arabia plans to award its first 400MW wind farm project in December this year. Reuters

Saudi Arabia’s Renewable Energy Project Development Office (Repdo) has opened the four bids it received for its maiden 400MW wind farm project.

The planned $500 million scheme at Dumat Al Jandal, in the northern Al Jouf region, will be awarded on December 18 under a 20-year power purchase agreement with the Saudi Power Procurement Company (SPPC) after the bid evaluation process is completed, according to a Repdo statement on Tuesday.

“The kingdom’s first utility-scale wind project opens a new chapter in our journey towards a diversified energy mix. The development of a wind energy industry in Saudi Arabia is an important component of our wider industrial diversification strategy,” said Khalid Al Falih, kingdom’s Minister of Energy.

The project will “generate enough power to supply up to 70,000 Saudi households as it connects to the northern electricity grid”, he noted.

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Acwa Power of Saudi Arabia, France’s EDF Energies Nouvelles, Italy’s Enel Green Power and France's Engie are the four pre-qualified companies who submitted their bids earlier this year, which remained sealed until the opening ceremony in the kingdom on Monday, Repdo said.

The submitted bids range was between 7.99 and 12.71 halalas per kilowatt hour (2.13 and 3.39 US cents per kWh), Repdo said.

The bid opening results, however, “do not represent a ranking of bidders or a bidder’s compliance with the request for proposal requirements of the project, nor do they constitute a determination by Repdo of the outcome of the bidding process”, it noted.

Saudi Arabia, the world’s biggest oil exporter, which largely burns crude to generate power, has set ambitious targets to add 9.5 gigawatts of renewables by 2023, as it looks to sell more of its crude to export markets. The Saudi energy ministry’s renewables office is expected to tender 3.25GW of solar and 800 megawatts of wind capacity this year alone.

Dumat Al Jandal was chosen for the kingdom’s first utility-scale wind power project after pre-development studies showed a strong mixture of Class II and Class III wind capabilities on the site. The average annual generation from the wind plant is expected to be around 1.4 terrawatt hours (TWh), according to the statement. To put that in perspective, Scotland has a population a little over 5 million and requires 25 TWh of electrical energy each year.