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The Gulf’s first coal-fired plant secures $2.5bn debt package

Minority shareholders in Dubai’s $3.4bn Hassyan project include ACWA Power, China’s Harbin Electric and the Silk Road Fund.

Hassyan Energy, the project company of Dubai’s planned 2.4GW coal-fired plant, has achieved financial close by securing a $2.47 billion financing package from a group of lenders. 

The $3.4 billion project is a joint venture between government-run utility Dubai Electricity and Water Authority (51 percent) and a consortium (49 percent) comprising ACWA Power from Saudi Arabia, China’s Harbin Electric and the Beijing-based Silk Road Fund. It is expected to deliver four 600MW net-power units using ‘clean coal’ by March 2023.  

The financing package combines senior secured financing and a mezzanine tranche, according to ACWA. The banks and financial institutions involved include Industrial and Commercial Bank of China, Bank of China, Agricultural Bank of China, China Construction Bank, the Silk Road Fund, the UK’s Standard Chartered Bank, Saudi Arabia’s National Commercial Bank, UAE’s First Gulf Bank, Union National Bank, Commercial Bank International and Emirates NBD.

Earlier this July, the project secured a 25-year power purchase agreement with DEWA to supply all its electricity at a levelised tariff of less than $0.05 per kWh. 

The Hassyan project is the first coal-based power plant in the Gulf region, ACWA said. It is part of Dubai’s efforts to diversify the emirate’s energy mix under the Dubai Clean Energy Strategy 2050. 

The plan is for Dubai to generate 25 percent of its power from solar energy, 7 percent from nuclear, 7 percent from clean coal and 61 percent from gas by 2030.