The Dubai Electricity and Water Authority (Dewa) will next month award a contract for the consultancy stage of the latest phase of its 1,000MW solar park.
Waleed Salman, executive vice president of business development at Dewa, said that eight companies had been shortlisted and Dewa was in the final stages of evaluation. The winner of this stage will help Dewa to decide if it will award all of the remaining 800MW for the Mohammed bin Rashid Al Maktoum solar photovoltaic (PV) park in one single phase or separately into sections, such as two 200MW awards and one 300MW contract.
He did not disclose which companies were in the running for the consultancy work.
Once the consultancy firm is on board the utility will prepare the next stage including the request for bids, he said.
“We expect the request for bids by the end of the year, and we’ll give companies two to three months,” Mr Salman said. “So expect us to select the companies in the first half of next year,” he said.
The plant’s total capacity will be just over 1,000MW upon completion, which is expected by 2030. This is enough electricity, on average, to power more than 1 million homes.
The first phase, awarded to US firm First Solar, totalling 13MW, came online two years ago. The winner of the second bid round was announced in January, and with it, record-breaking low prices. Saudi Arabian firm, Acwa Power, won the award for 200MW at a fixed tariff of 5.84 US cents per kilowatt-hour compared to previous market lows achieved in Brazil at 8 US cents per kWh.
This led to many saying that this was the new PV benchmark rate, which is at the same price – if not cheaper – than power generation via natural gas. “This solar tender is the new benchmark,” UAE energy minister, Suhail Al Mazrouei, said last week.
Acwa chief executive Paddy Padmanathan said that the market could change, such as an increase in interest rates or construction costs. “It depends on when the tender comes up and the environment,” he said. “However, if all the conditions are the same [as today], the price will be even better than 5.84 cents.”
Separately, a German solar company is looking to throw its hat into the ring for Dubai’s next tender.
“We see [the UAE] as one of the most important areas for solar,” said Andrew de Pass, chief executive of Conergy. The company has projects in Saudi Arabia and Kuwait, and it is also competing for awards in Jordan and Egypt.
Conergy raked in US$500 million in revenue last year and expects to see a 20-30 per cent year-on-year growth with the Middle East market, making up about 10-15 per cent of its revenue over the next three years.
And getting a leg up in the race for the work at the Mohammed bin Rashid Al Maktoum solar park would be helpful. Mr de Pass said he is currently in Dubai for discussions with potential partners for the next major tender.
“The next tender will probably be more disciplined as to what would be a more appropriate long-term return on investment,” said Mr de Pass. “Sometimes in the first tender, you want to build market share and awareness. If I were in [Acwa’s] shoes, I would have done the same thing.”
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