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EDF consolidates low-carbon business

27 May 2025

 

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Seven years after securing its first project in the region, the 800MW third phase of Dubai's Mohammed Bin Rashid Al-Maktoum Solar Park, the Middle East subsidiary of French utility developer group EDF now boasts a cumulative gross capacity of about 12 gigawatts of alternating current (GWac) from power generation plants that are operating and under construction.

"We have a strong technical team, and we will continue to bid for new contracts across all power generation technology types," Luc Koechlin, managing director and CEO of EDF Middle East, tells MEED.

The firm aims to continue bidding for new contracts, despite the fact that some of the more established utility developers are deliberately stepping back from bidding on new tenders in the region in line with shifts in geographic or technical focus.

We are bidding for most of the low-carbon projects in the region because we have the ability and capacity to do so

This strategy will be strengthened as the firm consolidates its two business divisions – the erstwhile EDF International and EDF Renewables, which have been merged under an entity that will be known as EDF Power Solutions.

"EDF Power Solutions will become the low-carbon energy arm of EDF worldwide," Koechlin says, adding that the new business division will cover renewables, hydro pumping storage plants, thermal plants with carbon capture, power transmission, as well as battery energy storage systems (bess).

In addition to growing its low-carbon energy fleet, which is expected to reach a global production capacity of 600 terawatt-hours in 2035, EDF Power Solutions will be focusing on opportunities in the power transmission space, the optimisation of electricity system flexibility and more efficient consumption of electricity.

"It will include battery energy storage systems, especially if they are integrated as part of grid solutions or renewable energy projects, as well as demand-side management and energy efficiency," Koechlin tells MEED.   

Alongside its partners, South Korea's Korea Electric Power Corporation (Kepco) and Japan's Kyushu Electric Power Company, EDF is implementing the $3.8bn project to connect Abu Dhabi National Oil Company's offshore sites to cleaner onshore generation plants.

Koechlin says the company expects similar projects to come up in time, as Middle Eastern countries ramp up the deployment of intermittent renewable power into their electricity grids.

On the generation front, EDF Power Solutions will be looking at adding 2GW of new low-carbon capacity every year in the Middle East region. 

"We will focus on all types of technology, so long they are low-carbon, and across the entire value chain, from the design to the operation of these assets," he says.

The executive adds that combined-cycle gas turbine plants are part of EDF Power Solution's generation spectrum, "so long as they involve committed carbon capture solutions".

Fastest-growing region

Koechlin notes that the Middle East is one of EDF's most rapidly growing regions globally – if not the fastest.

According to data from regional projects tracker MEED Projects, more than 100GW of renewable energy projects are in the planning and procurement stage in the Gulf region.

In the past three years, there has also been a major resurgence in gas-fired power plants, due to the fact that expanding intermittent renewable power necessitates the deployment of baseload capacity, in addition to storage solutions.

Besides Saudi utility developer Acwa Power, EDF is the only other developer that has been consistently bidding for contracts across a wide cross-section of power generation and transmission assets in the Middle East in recent years.

"We are bidding for most of the low-carbon projects in the region because we have the ability and capacity to do so," Koechlin says, adding that the firm has adopted an expansionary mode to match the volume of projects on the ground. 

"The Middle East region accounts for between 25% and 30% of our [global] portfolio. We expect this to continue growing. The competition is tough and … this market is extremely competitive, that's why we need to be innovative. We keep finding new ways to optimise our projects … to gain every single point of competitiveness."

Koechlin says he is aware that some of the more established international utility developers operating in the region have taken on a more selective approach when bidding for new contracts, but he is confident that finding innovative approaches will keep EDF in good standing in the coming years.

"What makes EDF different is we have strong technical teams … we like highly technical projects because that's where we can add value," he says.

To illustrate, he points to the multi-utility package for the Amaala tourism development project in Saudi Arabia, which EDF is developing in partnership with Abu Dhabi Future Energy Company (Masdar).

Understood to be worth $2bn, the total package entails the development of solar power, battery energy storage, transmission, water desalination and wastewater treatment facilities under one long-term contract.

Project finance

The wave of new generation, storage and transmission projects in the region – particularly in Saudi Arabia, where at least 44GW of gas-fired and renewable energy plants are under construction – does not impact the ability of investors to attract project finance, according to Koechlin.

"We never faced any liquidity issues, certainly not with our projects. First, we deploy long-term project finance, and lenders tend to prefer to work with experienced developers like EDF. Second, the region enjoys a stable public-private partnership regulatory framework, with little to no political risks. This makes our projects in the region very attractive for lenders," he says.

Data centres

The explosion of demand for data centres, both globally and in the Gulf region in particular, where countries are racing to establish global artificial intelligence hubs, offers major opportunities, Koechlin notes.

He says that there are three reasons why data centres are good news for utility developers like EDF. First, they use a lot of electricity; second, the electricity used by data centres is stable baseload capacity, making them suitable for small modular reactors (SMRs) or small-scale nuclear power plants; and third, they open up new opportunities for solar-plus-bess combinations.

In addition, most data centre end users, such as Amazon Web Services, Microsoft, Google and other technology companies, are now requiring low-carbon electricity, which aligns with EDF Power Solutions' generation assets portfolio, Koiechlin says, adding that SMRs can offer advantages, especially in jurisdictions with less developed grids and without large-scale nuclear power plant capacity. 

Green hydrogen

Having won one of the green hydrogen land blocks that Oman auctioned last year, EDF is understood to be in the early stages of studying and designing a large-scale green ammonia project.

Koechlin says that green hydrogen will play a role in the overall energy transition, and in delivering net-zero targets, although perhaps "not on the same scale as originally envisaged by some stakeholders or developers".

"Net-zero will need some green hydrogen, but the main question is the price at which offtakers are willing to purchase the product," he says.

In the interim, EDF is undertaking projects in several geographies to prepare the market and assess the willingness of offtakers to buy and use green hydrogen. "We will be ready once the market is ready," Koechlin concludes.   

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Jennifer Aguinaldo

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