Abu Dhabi tenders 2.5GW Taweelah C contract
24 July 2024
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Abu Dhabi state utility and offtaker Emirates Water & Electricity Company (Ewec) has issued the request for proposals (RFP) for a contract to develop and operate the Taweelah C combined-cycle gas turbine (CCGT) independent power project (IPP).
The Taweelah C IPP will have a generation capacity of up to 2,500MW and is expected to reach commercial operations in the third quarter of 2028.
Ewec expects to receive proposals for the contract by the fourth quarter of the year.
Ewec conducted an investor roadshow in April for the Taweelah C IPP, wihch is the first gas-fired power plant project to be procured by Abu Dhabi since 2020.
Ewec met with at least six utility developers separately, sources said at the time.
The power-purchase agreement (PPA) for Taweelah C is expected to expire by 2049, which is several years shorter than previous PPAs and in line with the UAE's plan to reach net-zero carbon emissions by 2050.
A team of UK-based Alderbrook Finance and US-based Sargent & Lundy are providing financial and technical advisory services to Ewec for the Taweelah C IPP.
"The carbon-capture-ready project will primarily provide transitional capacity to support the integration of renewable energy projects and to provide additional flexibility," Ewec said in a statement on 24 July.
The Taweelah C project will closely follow Abu Dhabi's IPP model, where "developers enter into a long-term agreement with Ewec as the sole procurer".
The project will involve the development, financing, construction, operation, maintenance and ownership of the plant, with the successful developer or developer consortium owning up to 40% of the entity.
The Abu Dhabi government will indirectly hold the remaining equity.
The state utility is also considering new gas-fired capacity in light of expiring capacity from several independent water and power producer (IWPP) facilities.
The plants that will reach the end of their existing contracts during the 2025-29 planning period include:
- Shuweihat S1 (1,615MW, 101 million imperial gallons a day (MIGD)): expires in June 2025
- Sas Al-Nakhl (1,670MW, 95MIGD): expires in July 2027
- Taweelah B (2,220MW, 160MIGD): expires in October 2028
- Taweelah A1 (1,671MW, 85MIGD): expires in July 2029
Ewec and the developers and operators of these plants are expected to discuss whether a contract extension is possible before the expiry of the contracts. Unsuccessful negotiations will result in the dismantling of the assets at the end of the contract period.
In 2022, MEED reported that Abu Dhabi had wound down the operation of Taweelah A2, the region's first independent water and power project. The power and water purchase agreement supporting the project expired in September 2021 and was not extended.
Ewec awarded its last CCGT IPP nearly four years ago. Japan's Marubeni Corporation won the contract to develop the Fujairah F3 IPP in 2020.
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