The European Commission has approved a joint venture between Abu Dhabi Future Energy Company PJSC (Masdar), Electricité de France S.A. (EDF), and Nesma Company Limited under the EU Merger Regulation.
The approval paves the way for collaboration between the leading renewable energy companies, with a focus on electricity generation and distribution in Saudi Arabia.
The Commission determined that the transaction does not raise competition concerns within the European Economic Area (EEA) due to its limited impact on European markets. The deal was reviewed under the simplified merger control procedure, a streamlined process for transactions unlikely to present major competitive risks.
The centerpiece of the joint venture is the Al Henakiyah Solar Power Plant, a 1.1-gigawatt solar project in Saudi Arabia’s Al Madinah province. Last year, Masdar, EDF Renewables, and Nesma signed a Power Purchase Agreement (PPA) with the Saudi Power Procurement Company (SPPC) to advance the $1 billion project, which aims to significantly increase Saudi Arabia’s renewable energy capacity.
Once operational in 2025, the plant will supply electricity to approximately 190,000 homes annually and is expected to cut carbon dioxide emissions by over 1.8 million tonnes per year, making it one of the world’s largest single-site solar facilities.
The project stands out for its competitive pricing at USD 16.84 per megawatt-hour, which highlights the growing focus on cost-effective renewable energy solutions in the region.
Under the terms of the agreement, the plant will be developed, built, owned, and operated by the consortium for 25 years.
A key feature of the Al Henakiyah Solar Power Plant project is its contribution to Saudi Arabia’s Vision 2030 goals. The country aims to increase the share of renewables in its energy mix to 50% by the end of the decade, with solar energy playing a pivotal role in achieving this target.
As part of the consortium’s commitment to local economic development, at least 19% of the plant’s equipment, materials, and services will be sourced from Saudi companies during the construction phase.
Saudi nationals will make up 25% of the workforce during the first five years of operation, with this proportion increasing to 75% over the 25-year life of the plant.
The Al Henakiyah project builds on previous successful collaborations between Masdar, EDF, and Nesma. Last year, the consortium completed the development of a 300-megawatt (MW) utility-scale solar power plant in Jeddah, another milestone in Saudi Arabia’s renewable energy push.
Awarded by the Renewable Energy Project Development Office (REPDO) under Saudi Arabia’s Ministry of Energy, the Jeddah solar plant represents a major step forward in the kingdom’s solar energy ambitions.
The consortium submitted the most cost-competitive bid for the project, at SAR 60.9042 (USD 16.24) per megawatt-hour, demonstrating its ability to deliver efficient, large-scale renewable energy projects.
Located 50 km southeast of Jeddah, the plant was designed, financed, and constructed by the consortium under a 25-year PPA with SPPC.
It began operations in 2023, using advanced photovoltaic (PV) technology, including bifacial PV modules and single-axis tracking systems that follow the sun’s movement to maximize energy generation.
Founded in 2006, Masdar is a subsidiary of Mubadala Investment Company, one of the UAE’s sovereign wealth funds. The company is a global leader in renewable energy, with a presence in over 40 countries. Masdar has been at the forefront of advancing solar, wind, and waste-to-energy projects worldwide, with a strong focus on the Middle East and North Africa (MENA) region.
Masdar’s collaboration with EDF and Nesma is part of its broader strategy to support the energy transition in the GCC. The company has made major achievements in contributing to renewable energy development across Saudi Arabia, the UAE, and other parts of the region.
EDF Renewables, the renewable energy subsidiary of the French utility giant EDF, has been increasingly active in the Middle East’s growing renewable energy sector, with a portfolio that covers solar, wind, and energy storage solutions.
