ACWA Power Consortium named preferred bidder of $1bn Ouarzazate CSP in Morocco

The 160 MW Ouarzazate CSP Project is a green field Independent Power Project (IPP) to be developed as the first project for the Moroccan Agency for Solar Energy (MASEN) in a series of several planned developments at the Ouarzazate Solar Complex. The Ouarzazate complexis set to develop into a 500 MW solar park incorporating several utility-scale solar power plants using various solar technologies. The first plant within this complex will be the 160 MW Ouarzazate CSP Project with 3 hours of thermal energy storage to be developed on a Build, Own, Operate and Transfer (BOOT) basis.

ACWA Power had initially submitted the prequalification documents on the 4th of October 2010 together with 18 other consortiums. ACWA Power is the lead developer of one of only 4 consortiums prequalified by MASEN on the 24th of December 2010. The transaction was managed in a transparent manner by MASEN under the tight scrutiny of the World Bank and other international financing institutions (IFIs).

The ACWA Power consortium selected as EPC contractor a consortium composed of Spain's TSK ElectrónicayElectricidad, AccionaInfrastructuras, AccionaIngeniería, and SenerIngeniería y Sistemas. The EPC consortium will procure part of the scope locally in Morocco. The Operation and Maintenance will be undertaken bya consortium led by NOMAC,a subsidiary of ACWA Power. MASEN will be the off taker of the energy produced according to a 25-year Power Purchase Agreement (PPA). In addition, MASEN will provide Strategic Services to the Project such as the debt funding requirements.

The Consortium will target to achieve Financial Close by the end of 2012,while the plant Commercial Operation Date (COD) isplanned for the second half of 2015.

Whilst Moroccocurrently relies heavily on coal and other conventional sources to meet its energy needs, the country is well endowed with renewable energy resources that offer sustainable alternatives to fossil fuels. With the CSP technology used, the project will serve to abatea "green approach" saving approximately 470,000tons of CO2 equivalent emissionsevery year of operation. When combined with the avoided emissions of ACWA Power's two other solar projects; Bokpoort CSP Project in South Africa which saves approximately 230,000 tons of CO2 equivalent emissions per year and Khardozalovo PV which avoids CO2emission of approximately 48,600 tons per year; the total abated CO2 equivalent emissions every year reach 748,600 tons.The technology used in Ouarzazate will be a positive factor in offsetting the Moroccan grid peak power demand periodin particular due to itsthermal storage.

Mohammad A. Abunayyan, Chairman of ACWA Power, stated that "We are proud to enter our sixth international market and first market in North Africa continuing to deliver the lowest possible tariff in each and every transaction that we lead, for which we have become well known not only in Saudi Arabia but now also in each overseas market we step into. The tariff we have delivered is 28.8% lower than the one offered by the second bidder. Today in addition to our recent success in South Africa, where we were awarded Preferred Bidder status on 21st of May 2012 for the 50 MWeBokpoort CSP project, and our recent acquisition of a majority stake in a 60.4 MWp Solar PV plant in Bulgaria, we own majority stakes in fully operational assets in Oman, Jordan and projects under development in Turkey and Mozambique along with our assets in Saudi Arabia. Ouarzazate CSP IPP is a milestone also for this technology as it has demonstrated the cost at which solar power can be produced, which is significantly lower than what has been achieved to date and at the same time narrowing the gap between the cost of solar power produced using photo voltaic technology. This project, our second CSP solar plant will also bring us closer to achieving our goal of reaching a total power production capacity target of 38,000 MW by the end of 2017 of which 10% from renewable sources."

Abunayyan went on to say,"ACWA Power believes entering into a new market as an investor and operator also means embarking on a long-term relationship with the country as a whole and the local community specifically. Therefore we put a great deal of emphasis ensuring maximum economic value creation within Morocco by not just encouraging local manufacturing but also in skills transfer, training and local capacity building."