TASHKENT — Following agreements signed in March 2020, cooperation between the Uzbekistan Ministry of Energy, the Ministry of Investments and Foreign Trade, and ACWA Power has led to three major milestones in the development of power projects to enable Uzbekistan’s ambitious energy transformation plan and increase energy capacity by 2500MW.
The ground-breaking ceremony of the 1500MW Sirdarya CCGT plant, followed by the signing of two Power Purchase Agreements and Investment Agreements for two wind power plants located in Bukhara and Navoi, was conducted in the presence of Deputy Prime Minister and Minister of Investments and Foreign Trade of the Republic of Uzbekistan Sardor Umurzakov, and Alisher Sultanov, energy minister of the Republic of Uzbekistan, as well as a Saudi Arabian delegation led by Minister of Investment Eng Khalid Al-Falih, and Hisham Mishal Al-Suwailem, Saudi Ambassador to Uzbekistan.
Other attendees included senior representatives from the Uzbekistan Ministry of Energy, Ministry of Investments and Foreign Trade, ACWA Power and Air Products.
ACWA Power will be delivering these three projects utilizing its technical knowledge, expertise, and experience, to contribute directly to meeting Uzbekistan’s growing yearly electricity demand, which is expected to reach 110 billion kWh by 2030. The company’s contribution is also aligned with Uzbekistan’s national mandate to increase energy efficiency, introduce energy-saving technologies, and develop and implement renewable energy sources, under its recent energy sector reforms.
Al-Falih has affirmed that the Kingdom of Saudi Arabia, under the leadership of the Custodian of the Two Holy Mosques King Salman and Crown Prince, is keen to strengthen relations with Uzbekistan by supporting economic, investment and commercial cooperation between the two countries.
Al-Falih said: “These visionary projects mark the start of a new chapter in the investment relationship between Saudi Arabia and Uzbekistan. As the Minister of Investment for Saudi Arabia, it is particularly pleasing to see a homegrown Saudi company such as ACWA Power supporting Uzbekistan to deliver such a vital component of its infrastructure investment program, which is central to the country’s economic transformation. The Ministry of Investment for Saudi Arabia is proud to have played a leading role in facilitating this momentous agreement.”
“ACWA Power is a true Saudi success story and a cornerstone of the Kingdom’s burgeoning private sector. This growth is being supported by various business-friendly reforms introduced by the Ministry of Investments and Foreign Trade. I am confident that this partnership signals the start of further collaborations in the trade and investment space for both of our nations.”
Al-Falih said that the projects, which have an estimated total investment value of $2.5 billion, will contribute directly to the growth of power generation capacity in Uzbekistan, to keep pace with the increasing demand, which is expected to reach 18 gigawatts/h by 2030. He pointed to the successes achieved by ACWA POWER, which was a start-up company in 2004, and now has become one of the leading Saudi companies in providing clean energy solutions.
He said that Saudi Arabia has a long history and a leading global position in the field of energy, pointing out that renewable energy in the Kingdom today has ambitious programs and a promising future, especially in light of rich resources in solar energy, wind energy, and competing expertise to develop these programs. This is embodied in enabling the renewable energy sector, within its national energy mix, as it aims to raise the level of electricity production using renewable energy by 50% in 2030, while the remaining percentage will depend on gas production.
Al-Falih pointed out that Saudi Arabia has ambitious plans in many other fields of renewable energy, as it launched, during the past year, several projects and initiatives in this context, including, The Green Hydrogen Production Project in NEOM. The Kingdom, as part of its interest in sustainable development, also initiated the circular carbon economy approach, which was endorsed by the leaders of the G20 countries, and represents a comprehensive, integrated and realistic approach to managing emissions that contribute to global warming, as well as its possible application in line with each country's priorities and circumstances.
He also praised the prominent role the Ministry of Energy in the Kingdom of Saudi Arabia played to facilitate the agreements signed, encouraging Uzbekistan to benefit from the expertise of the Saudi Ministry of Energy in the field of energy — particularly clean and renewable energy.
Sultanov said: “Most importantly, today’s milestones show that we are delivering on our promises. Enhancing Uzbekistan’s clean energy capacity involves many developmental and investment targets to be hit, over a period of time. By executing our plans efficiently, we will only attract more investment to Uzbekistan, and improve our nation’s energy status. The Ministry extends its deep thanks to ACWA Power and the wider Saudi delegation for making this triumph happen. We look forward to a long and fruitful working relationship.”
ACWA Power is also committed to training and upskilling 1,000 local employees in Uzbekistan during the project’s construction and operation phases, generating long-term, socio-economic value through knowledge sharing and job creation.
ACWA Power Chairman Mohammad Abunayyan said: “As a proud Saudi company, we are privileged to play a vital role in supporting Uzbekistan’s decarbonisation efforts and energy transformation, stemming from the international cooperation between Saudi Arabia and Uzbekistan under their progressive and visionary leadership.
“We would like to take this opportunity to thank the Saudi delegation, led by Minister of Investment Khalid Al-Falih and Hisham Mishal Al-Suwailem, Saudi Ambassador to Uzbekistan, for their valuable support of these projects. We also extend our gratitude to the Republic of Uzbekistan’s government, the Ministry of Energy and the Ministry of Investments and Foreign Trade for their confidence in ACWA Power’s mission to safely, reliably and responsibly produce power at low cost.
“Through the addition of new renewable energy capacity, exploration of innovative technologies and the advancement of cleaner, more efficient and cost-competitive gas power, ACWA Power is expanding its presence in Uzbekistan, a high growth market, leveraging our global expertise and technical know-how to create long-term and sustainable value for the country’s local communities.”
Sirdarya CCGT
The groundbreaking of the1500MW Sirdarya CCGT plant was marked by ceremonially commencing construction. The project will provide cleaner, more efficient and cost-competitive gas power that can be utilised across industries in Uzbekistan and is expected to meet 15 percent of power demand in Uzbekistan and comprise of 8 percent of installed power capacity when complete.
With an approximate aggregate worth of $1.2 billion, the plant has an efficiency rate of over 60 percent — saving almost twice the natural gas currently used for electricity production compared with older plants in the country.
Its design, operational, and real time monitoring structure is state of the art, engineered by global experts to drive the energy production process round the clock, to create a seamless flow through the air-insulated switchyard to the national power grid of Uzbekistan, while offsetting 2.2 million tonnes of carbon dioxide emissions each year.
Bukhara, Navoi Wind Projects
The two Power Purchase Agreements for the two wind power plants; with an aggregate power generation capacity of 1000MW was signed by Isakulov Dadajon Aynakulovich, chairman of JSC “National Electric Grids of Uzbekistan” and Rajit Nanda, chief portfolio management officer and interim CIO of ACWA Power. The two Investment Agreements were signed by Sardor Umurzakov from the Ministry of Investments and Foreign Trade and Abunayyan.
The ‘Bash’ and ‘Dzhankeldy’ plants which are located in the Bukhara and the Bukhara/Navoi regions respectively, have a total investment value of $1.3 billion, and are expected to offset 1.6 million tons of carbon emissions per year. Powered by approximately 200 wind turbines, the projects will contribute one third of Uzbekistan’s 3GW wind energy targets, supplying 2.7 million households and supports the government’s aims to have 30 percent of its power capacity from renewable sources by 2030.
Cooperation on developing renewable energy and hydrogen programs
The Uzbekistan Ministry of Energy, ACWA Power and Air Products (a world leader in hydrogen production and distribution), has entered into a strategic framework agreement to develop research programs and projects in the field of hydrogen and renewable energy, using the extensive experience of ACWA Power and Air Products. The agreement was signed by Sultanov and Abunayyan.
This agreement will support Uzbekistan’s ongoing efforts to reduce greenhouse gas emissions as part of global commitment to the Paris Agreement under the UN Framework Convention on Climate Change. 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 thirteen countries worldwide. — SG
