Eximbank to finance $150m for UAE solar power project

The state-run Export-Import Bank of Korea said Monday that it will provide $150 million in project financing for a major solar power generation project in the United Arab Emirates, the first of such to be undertaken by South Korea.

This financial procurement comes after the state-owned Korea Western Power Co.’s joint win of the bidding with EDF-Renewables, a subsidiary of Electricite de France, which will now fully organize the entire process of the project.

Korea Eximbank has long expressed its commitment to this project since the initial stages of the bidding process, through a letter of interest. The financing accounts for up to 16.67 percent of the expected total project cost of $900 million.

Through project financing, Eximbank will secure loan repayment from future cash flows generated by the project.

Set in the Ajban desert area, 70 kilometers east of Abu Dhabi, this project stands as the largest solar power project in terms of both installed capacity and investment among those won by Korean companies.

Covering an area of 20 square kilometers, the plant will feature around 2.93 million solar modules, producing a total capacity of 1,500 megawatts.

Upon its completion in 2026, the plant will rank as the seventh-largest solar power facility globally.

The annual energy output is projected to be about 4500 gigawatt-hours, which can supersede the annual household electricity consumption of Incheon. The generated electricity will be purchased entirely by the UAE's Emirates Water and Electricity Company for 30 years.

"Countries in the Middle East, including the UAE and Saudi Arabia, are continuously initiating large-scale solar power projects as part of their carbon neutrality policies to combat climate change," an official from Korea Eximbank said.

"We are committed to supporting our companies in securing subsequent projects in the fiercely competitive Middle Eastern market, thereby contributing to the global transition to green energy," the official said.

Last year, Korea Eximbank also issued a letter of interest to support Kowepo's successful bid for the Manah 1 solar power project in Oman, which marked the first solar project in the Middle East won by a South Korean company.