Uzbekistan’s Ministry of Energy: One of world’s lowest solar energy tariffs received via tender (Exclusive)

Oil&Gas Materials 31 October 2019 15:17 (UTC +04:00)

BAKU, Azerbaijan, Oct. 31

By Fakhri Vakilov-Trend:

An investment project for the construction of a 100-MW solar photovoltaic power plant in Uzbekistan’s Navoi region is carried out with technical assistance and under the rules for competitive selection of the World Bank Group's International Finance Corporation, a representative of Uzbekistan’s Ministry of Energy told Trend in an interview.

“It should be noted that 23 companies from China, South Korea, Japan, Saudi Arabia, the United Arab Emirates, India, South Africa, Russia, Spain, Norway and France participated in the pre-qualification selection, of which 11 companies passed it. Out of them, five companies submitted commercial offers,” said the representative.

According to the representative, after studying and evaluating the technical and commercial proposals of the bidders, the tender commission declared Masdar (UAE) company winner of the international tender with a tariff of 2.679 US cents per 1 kWh of electricity generated and a construction period of 12 months.

Moreover, according to the official, from Saudi Arabian ACWA Power’s side the price was over 2.9 cents, Chinese TBEA Xinjianing Sunoasis Co Ltd over 3.5 cents, Chinese Jinko Power consortium and Saudi Arabian Aljoimah Energy & Water Consortium over 3.7 cents and French Total Eren over 4.2 cents per 1 kWh.

“One of the lowest solar energy tariffs in the world (taking into account the level of insolation) was obtained from the competitive selection. Furthermore, in accordance with the terms of the tender, the winner took significant obligations to fulfill the contract terms. If they are not fulfilled, the winner will incur significant financial losses (bid bond guarantee), which in turn guarantees timely and high-quality implementation of the project,” the official emphasized.

According to the representative, the project will be implemented on the basis of public-private partnership (PPP) under the build-own-operate (BOO) mechanism through direct investment by a foreign investor.

The estimated cost of capital costs for the construction of a solar power plant with a capacity of 100 MW currently stands at about $70-$75 million.

“Moreover, Uzbekistan’s National Electric Networks JSC (a single purchaser) will guarantee the purchase of all generated electricity for 25 years from the date of commissioning of the solar photovoltaic power station,” ministry’s representative noted.

The start of construction work is scheduled for the 1Q2020, and the commissioning of the facility in the 1Q2021.

The official stated that taking into account the positive results of competitive selection in the field of renewable energy, Uzbekistan’s Ministry of Energy is taking a series of measures to announce and conduct another competitive bidding for the construction of solar and wind power plants with a total capacity of about 700 MW on a PPP basis in 2020.


Follow author on Twitter:@vakilovfaxri