Mobilising finance for investment and innovation in low-carbon energy is key in the mitigation of climate change, as banks have a key role to support corporates, investors, individuals and the broader society in moving towards a carbon neutral world by mid-century. This transition is already well underway with up to 56% of the world's electricity expected to be generated by Photo Voltaic (PV) and wind energy by 2050.
Combining the latest innovations in solar technology and record-breaking size, the Al Dhafra solar power plant in Abu Dhabi sets a new milestone in renewable energy.
Powering 160,000 homes while cutting emissionsAs a landmark project in renewable energy globally, the Al Dhafra PV2 solar project located in Abu Dhabi will become the world's largest single site photovoltaic plant. It is expected to be commercially operational by 2022. It will generate enough electricity to sustain power for up to 160,000 homes across the United Arab Emirates (UAE), and reduce Abu Dhabi's CO2 emissions by more than 2.4 million metric tons per year - equivalent to removing 470,000 cars from roads. Notably, the new solar site will also deploy the latest innovations in crystalline bifacial solar technology, which will utilise both sides of the solar panel to generate increased energy.
Amine Bel Hadj Soulami, Head of BNP Paribas Middle East & Africa said: "Scaling up the energy transition through finance is essential to tackling the climate crisis, and BNP Paribas is committed to supporting this vital shift towards a low carbon economy. Renewable energy is a strategic pillar of the UAE's sustainability strategy, and the Al Dhafra PV2 solar plant will significantly contribute to the 50% clean energy-sourcing objective by 2050."
With a total cost of approximately $1 billion, Al Dhafra is a multi-party project procured by the Emirates Water and Electricity Company (EWEC) and developed by EDF Renouvelables and Jinko Power (HK), a subsidiary of Jinko Power Technology Co, Ltd (Jinko Power), in partnership with the Abu Dhabi National Energy Company (TAQA) and Masdar.
BNP Paribas acted as lead bank on the deal, serving as sole Bookrunner, Documentation Bank, Mandated Lead Arranger and Hedge Provider. In addition, BNP Paribas acted as the sole Equity Bridge Loan (EBL) Lender to EDF Renouvelables and Jinko Power, and EBL Facility Agent. Six other Mandated Lead Arranger banks participated in the financing of the project.
Solar energy has unquantifiable potential to decrease greenhouse gas emissions. The World Bank states that the potential for electricity generation from solar photovoltaic sources dwarfs most countries' current electricity demand.
BNP Paribas was in the top three lenders for EMEA Renewable Energy Project Finance Volume by Mandated Lead Arranger in 2020.
In 2018, BNP Paribas joined forces with four other large banks to develop a common methodology for measuring and aligning bank loan portfolios with the goals of the Paris Agreement. This methodology, called PACTA, covers the utilities, automakers, and oil & gas sectors, as well as other high emission sectors across transportation and heavy industry.