MUFG is pleased to confirm the financial close of a limited-recourse financing for the Al Dhafrah PV2 solar project in Abu Dhabi (PV2) supporting a consortium comprising of EDF Renewables, Jinko Power (HK), a subsidiary of Jinko Power Technology Co, Ltd (Jinko Power), Abu Dhabi National Energy Company (TAQA) and Masdar.

MUFG acted as Mandated Lead Arranger, Hedging Bank, Global Facility Agent, Offshore Security Trustee and Offshore Account Bank for this project. With a capacity of 2GW, PV2, once constructed, will be the largest single project solar plant in the world and is expected to offset approximately 2.4 million metric tonnes of CO2 p.a., while generating the equivalent electricity to power over 160,000 households across the UAE.

The successful closing concludes a process initiated in June 2019 by Emirates Water and Electricity Company (EWEC) and won by the consortium of EDF Renewables and Jinko Power. The Project was procured by EWEC under its well established IPP model, with PV2 set to become the second utility scale renewables project to be financed using the framework that was originally developed to procure Abu Dhabi's fleet of conventional power stations. The first such renewable energy project was Sweihan Solar PV, for which financing was also arranged by MUFG in 2017.

PV2 is underpinned by a long-term Power Purchase Agreement based on a tariff that was set through the aforementioned competitive tender. The rigorous procurement process led by EWEC resulted in one of the most cost-competitive tariffs for solar PV energy, set at USD 1.35 cents/kWh on a levelized cost of electricity (LCOE) basis, which upon financial closing, was further improved to USD 1.32 cents/kWh, primarily driven by hedging and financing cost improvements, in addition to other optimization efforts.

The plant will be commissioned in 2022 with approximately 4,000 jobs expected to be generated during construction. It will be the first of its scale to deploy bifacial module technology, meaning that both sides of the PV modules capture light in order to increase energy yield.

Andrew Doyle, Director, and Sofiane Fendri, Vice President within MUFG Power and Renewables' team in EMEA leading MUFG's involvement in PV2, said:

"We are proud to have played a part in the successful closing of this landmark project which is of great significance for the decarbonisation of Abu Dhabi's power supply, as well as MUFG's market leading Renewables franchise."

Stephen Jennings, Head of Energy and Natural Resources in EMEA at MUFG said:

"We are proud to have been part of the pioneering of an innovative financing solution which we hope will be replicated to allow future large scale renewable energy projects in the region to attract the necessary levels of finance to meet ambitious deployment targets."

MUFG is a leading provider of project finance for renewable energy globally. MUFG has been an active lender to renewable generation projects for nearly two decades across the Americas, Europe, the Middle East, Asia and Australia. We have financed over 450 transactions representing more than 75GW of renewables generation capacity, including providing finance to over 30 offshore wind farms.