Taqa, Jera, Albawani raise funds for $4B Saudi power plants

Taqa, Jera, Albawani raise funds for $4B Saudi power plants

Abu Dhabi National Energy Company PJSC (Taqa), JERA, and Albawani have announced the financial closing of Rumah 2 and Al Nairyah 2 power plants in Saudi Arabia. The project, valued at approximately AED 14.7 billion ($4 billion), aims to add 3.6 GW of additional power capacity to support the Kingdom's growing energy demand.

The consortium, consisting of Taqa (49%), JERA (31%), and Albawani (20%), has secured $3.4 billion in funding through a mix of local, regional, and international lenders, including KEXIM and Saudi National Bank [2]. The projects, which will be constructed through special purpose entities, are expected to power 1.5 million homes while cutting CO₂ emissions by 60% compared to oil-fired plants [1].

Construction of the two greenfield power plants, totaling 3.6 GW, will be undertaken by dedicated engineering, procurement, and construction (EPC) companies owned by the consortium. Siemens Energy LLC has been selected as the original equipment manufacturer, with Harbin Electric International Co. Ltd. and China Tiesiju Civil Engineering Group Co. Ltd. serving as the EPC contractors.

The projects align with Saudi Arabia's Vision 2030 goals, aiming to achieve a 50% share of electricity from gas and renewables by 2030 and a net-zero emissions target by 2060 [3]. The plants are designed to integrate carbon capture and storage (CCS) technologies in the future, enhancing their adaptability to evolving climate regulations [4].

The 25-year Power Purchase Agreements (PPAs) with the Saudi Power Procurement Company (SPPC) provide long-term revenue visibility, reducing investment risks. Siemens Energy's $1.6 billion contract to supply turbines and generators underscores the technical and financial credibility of the project [1].

While gas price volatility is a potential risk, Saudi Arabia's energy efficiency reforms and projected growth in renewable integration by 2030 are expected to mitigate exposure to volatile fossil fuel markets [2]. The inclusion of CCS readiness could unlock future revenue streams through carbon credits or regulatory incentives [4].

The Rumah 2 and Al Nairyah 2 power plants exemplify how strategic infrastructure investments can align with both environmental imperatives and financial returns. For global investors, these projects offer a gateway to Saudi Arabia's energy transition, leveraging the Kingdom's vast market potential, stable regulatory environment, and commitment to decarbonization.

References:
[1] Siemens Energy secures USD 1.6 billion project to advance Saudi Arabia’s energy transition [https://www.siemens-energy.com/global/en/home/press-releases/siemens-energy-secures-usd-1-6-billion-project-to-advance-saudi-.html]
[2] Saudi Electricity Company secures $3.4 billion funding for two new power plants [https://gulfnewsjournal.com/stories/saudi-electricity-company-secures-3-4-billion-funding-for-two-new-power-plants/]
[3] Siemens Energy Secures $1.6 Billion Project for Rumah 2 and Nairyah 2 Power Plants in Saudi Arabia [https://constructionfront.com/2025-03-14-siemens-energy-secures-1-6-billion-project-for-rumah-2-and-nairyah-2-power-plants-in-saudi-arabia/]
[4] Saudi Arabia's Energy Transition: Strategic Partnerships and Green Financing [https://www.ainvest.com/news/saudi-arabia-energy-transition-strategic-partnerships-green-financing-power-future-ccgt-projects-2508/]