The Saudi Power Procurement Company inked a power purchase agreement (PPA) for the 700 MW Yanbu wind energy project in the Madinah region with a consortium of Japan’s Marubeni and Abdulaziz Al Ajlan Sons (Ajlan & Bros), according to a statement. The project, which has a levelized cost of energy at USD 0.017 per kWh, is valued at over SAR 1.7 bn, SPA reports.

BACKGROUND- Yanbu, expected to enter operations by 2026, follows the 600 MW Al Ghat and 500 MW Waad Al Shamal projects — both also awarded to the same consortium. The group secured Al Ghat and Waad Al Shamal PPAs back in May last year at record-low tariffs of USD 0.015 and 0.017/kWh, according to Meed.

The Yanbu site faced delays during the tender process, with land availability cited as a key factor holding back the award. The site also has lower wind potential and weaker wind speed compared to the previous two sites, which raised questions at the time whether this would be reflected in the tariff offer.

The big picture: The project falls under Saudi Arabia’s National Renewable Energy Program , which aims to phase out oil burning to reach a 50/50 mix of renewables and gas by 2030. The Energy Ministry is targeting 20 GW of new capacity per year to reach 100 to 130 GW of output from renewable power by the end of the decade.

(** Tap or click the headline above to read this story with all of the links to our background and outside sources.)

Tags: