TAQA Seals Financing-Backed Al Dhafra Power Project

(MENAFN- The Arabian Post) Arabian Post Staff -Dubai

Abu Dhabi National Energy Company PJSC, known as Abu Dhabi National Energy Company PJSC, and Emirates Water and Electricity Company have finalised a 3.6 billion dirham agreement for the Al Dhafra Power Plant, marking a significant addition to Abu Dhabi's generation capacity and underlining continued investor confidence in the emirate's regulated utilities framework.

The transaction centres on a long-term project financing structure in which about 85 per cent of the total cost is supported by debt arranged through a broad consortium of regional and international lenders. The banking group includes Standard Chartered Bank, Abu Dhabi Commercial Bank, Agricultural Bank of China, Doha Bank, First Abu Dhabi Bank, HSBC, Industrial and Commercial Bank of China, KfW, National Bank of Kuwait, RAK Bank, Woori Bank, Abu Dhabi Islamic Bank, Boubyan Bank and Ajman Bank. The depth of the lender pool reflects the scale of the project and the credit standing of the off-taker structure underpinning it.

Al Dhafra Power Plant is positioned as a core asset within Abu Dhabi's power system, supporting rising electricity demand driven by population growth, industrial expansion and the accelerating energy needs of data centres and advanced manufacturing. The project is aligned with the emirate's long-term infrastructure planning, which seeks to balance reliability, affordability and sustainability while maintaining fiscal discipline.

For TAQA, one of the region's largest listed integrated utility firms, the deal strengthens its domestic generation portfolio and reinforces its role as a central pillar in Abu Dhabi's energy strategy. The company has steadily expanded its regulated asset base across power and water, prioritising predictable cash flows supported by government-linked counterparties. Executives have consistently emphasised that such assets provide resilience against commodity price volatility and global market shocks.

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EWEC's involvement is equally pivotal. As the single buyer and planner of water and electricity capacity in Abu Dhabi, the company plays a critical role in shaping generation investments and ensuring security of supply. Its long-term power purchase arrangements are designed to offer revenue visibility to developers while safeguarding end-user tariffs through competitive procurement and efficient financing.

Industry analysts note that the financing structure of Al Dhafra highlights several broader trends across Gulf utility markets. Banks remain willing to commit large volumes of capital to infrastructure projects with clear regulatory frameworks, stable offtake agreements and strong sponsors. The presence of both conventional and Islamic lenders also illustrates the flexibility of project finance structures in the region, accommodating diverse funding preferences without complicating execution.

The involvement of Asian and European banks alongside local institutions points to the continued internationalisation of Abu Dhabi's infrastructure funding. Lenders from China and South Korea have expanded their footprint in Middle East utilities, reflecting strategic interests in long-term assets and cross-border partnerships. European development lenders, meanwhile, continue to support projects that meet stringent technical and governance standards.

Construction and commissioning timelines for Al Dhafra are expected to follow a phased schedule, with capacity coming online in line with forecast demand growth. While technical specifications have not been publicly detailed in the financing announcement, the plant is understood to incorporate efficiency benchmarks consistent with modern thermal generation standards, supporting lower emissions intensity compared with older assets.

The project also sits within a wider transition context, as Abu Dhabi balances investment in renewables with the need for dependable baseload power. Gas-fired generation remains essential to grid stability, particularly as solar and other intermittent sources account for a growing share of installed capacity. Policymakers have signalled that flexible thermal assets will continue to play a role alongside clean energy investments.

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