Alec and Butec win Dhafra waste-to-energy contract

15 April 2024
The joint venture will undertake the design and build package for the IPP project

A joint venture of the UAE's Alec Engineering & Contracting (Alec) and Dubai and Beirut-headquartered Butec has been selected to design and build Abu Dhabi’s first waste-to-energy (WTE) plant project.

The Alec-Butec JV will oversee the engineering, procurement and construction of all non-process-related activities, encompassing tasks such as civil engineering, concrete and structural steel work, installation of mechanical, electrical, and plumbing (MEP) systems, as well as building services.

The construction team will also manage external works and site infrastructure development.

The joint venture will partner with Zurich-headquartered Hitachi Zosen Inova (HZI), part of the consortium that will develop the project and which will undertake the project's main engineering, procurement and construction (EPC) work.

The plant will be located near the Al Dhafra landfill in Abu Dhabi. Once complete, it will process 900,000 tonnes of non-recyclable waste annually for 30 years and generate about 80MW of electricity from a non-fossil fuel source.

The aim of the project is to prevent the release of nearly 1.1 million tonnes of carbon dioxide-equivalent emissions annually, Alec and Butec said. 

MEED Projects estimates that the Dhafra WTE project will require an investment of at least $600m.

Concession agreement

Abu Dhabi-based utility offtaker Emirates Water & Electricity Company (Ewec) and Tadweer Group signed the concession agreement with the successful bidder for developing the Dhafra WTE project on 27 March.

Japan's Marubeni Corporation leads the consortium, which includes Japan Overseas Infrastructure Investment Corporation and HZI.

The winning team proposed a levelised waste treatment cost of AED175 ($47.6) a metric tonne (MT) for the project.

This is equivalent to 45% of the tariff of AED391/MT proposed by the second team, which comprises France's Suez and the local Pal Cooling Holding, according to industry sources.

MEED understands the power tariff for the project is fixed at 11.215 fils a kilowatt-hour (kWh). 

US/India-based Synergy Consulting is the financial adviser to the Marubeni consortium.

The project will involve the financing, construction, operation and maintenance of the WTE plant, which will use advanced moving grate technology to convert municipal solid waste into electricity using a high-efficiency steam turbine generator set.

The successful developer consortium will own a 40% shareholding in the project's special-purpose vehicle.

The local/Australian Tribe Infrastructure Group is the clients' financial adviser, while the UK's Ashurst and Denmark's Ramboll are legal and technical advisers, respectively.

The project aligns with the UAE's aim to divert 75% of waste away from landfills.

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