RIYADH: Utility firm ACWA Power, backed by Public Investment Fund, is a step closer to building solar energy plants worth $3.4 billion across Saudi Arabia after securing finance from a bank consortium. The company, which owns a 50.1 percent stake in each of the three projects, secured a SR8.6 billion ($2.3 billon) credit facility from local, regional and international institutions, including Saudi Awwal Bank, Banque Saudi Fransi, and Mizuho Bank according to a statement to the Kingdom’s stock exchange. Riyad Bank, Saudi National Bank, Standard Chartered Bank and HSBC are also part of the consortium. The projects of Ar Raas 2, Saad 2 and Al-Kahfah have a production capacity of 4.55 gigawatts, powering approximately 750,000 households. They also have a capacity of approximately 2,000 megawatts, 1,125 MW and 1,425 MW of renewable power respectively, Of the total investment cost, SR8.6 billion was allocated to finance projects on a non-recourse basis. The credit facility tenor will extend for 27.75 years, guaranteed by ACWA Power pro-rata share of an equity bridge loan, standby equity and reserve account. The Public Investment Fund-owned Water and Electricity Holding Co. also known as Badeel, is a partner in the projects with a 49.9 percent equity stake in each of the three companies. SNB is one of the financing entities. Both are related parties, the statement added. In May 2023, ACWA Power and Badeel signed power purchase agreements with the Saudi Power Procurement Co. to develop and operate the three large-scale plants. The solar initiatives are part of the National Renewable Energy Program, a scheme overseen by the Ministry of Energy, with PIF assigned to establish 70 percent of NREP’s target capacity. Aligned with the Kingdom’s Vision 2030 initiative, the Ministry of Energy aims to increase the share of renewables by 50 percent of the energy mix by 2030. The wealth fund is currently developing a total of five projects, with a cumulative capacity of 8 GW and over $6 billion of investment from the fund and its partners. The fund’s renewable projects, including Ar Raas 2, Saad 2, Al-Kahfah, Sudair, Shuaibah 2, aim to enable and support Saudi Arabia’s private sector through requirements for significant local content contribution and the procurement of equipment, supplies and services through local supply chains. In 2023, an ACWA Power-led consortium secured financial closure for the Al-Shuaibah solar projects with an investment of $2.37 billion. The 2,061 MW projects of Al-Shuaibah 1 and Al-Shuaibah 2, are in Jeddah and expected to be operational by 2025. Once completed, the solar project is expected to provide power to approximately 450,000 households. The consortium includes ACWA Power Co., Badeel and the Saudi Arabian Oil Co., also known as Saudi Aramco.