TOKYO -- Japanese trading house Marubeni looks to open a megasolar plant in Saudi Arabia by June 2023, the company's first solar project in the country and fourth in the Middle East.
Marubeni has formed a joint venture with Saudi utility Al Jomaih Energy & Water for the plant, to be built in Mecca Province. The Rabigh solar plant will carry a capacity of 300 megawatts and sell power over a 25-year period. It will serve an industrial region, and Marubeni will handle construction, maintenance and operation.
The trading house owns 50.1% of the new venture, with Al Jomaih Energy & Water holding the rest. A total of 17 billion yen ($156 million) in financing will come from three banks, including the Japan Bank for International Cooperation.
Saudi Arabia is pursuing solar projects, with Japanese, European and domestic players competing for contracts in the desert country. Marubeni holds a stake in the Sweihan megasolar development in the United Arab Emirates, one of the largest in the world at 1.17 gigawatts.
Marubeni has amassed expertise in choosing locations for solar panels and analyzing sunlight radiation volumes. The company plans to use this know-how to expand its megasolar footprint in the Middle East.
Marubeni's power-generating projects extend to 19 countries, but most involve fossil fuels. The company intends to lift the ratio of renewable energy in its portfolio to about 20% by 2023, up from 15% today, as the global trend toward decarbonization accelerates.