Jordan is pushing ahead with the second and third rounds of its direct proposal renewable energy programme, despite still not having completed the majority of agreements for the initial round.

The kingdom’s Ministry of Energy and Mineral Resources (MEMR) has prequalified a total of 47 expressions of interest, 24 of those conditionally, for the second direct proposal round and has invited companies to submit expressions of interest for the third round.

For the third round, MEMR has increased the capacity of projects to 100MW, an increase from the maximum 50MW for solar photovoltaic (PV) projects and 50-100MW for wind power schemes in the second round. Companies have until 10 April to submit expressions of interest for the third direct proposal round.

Under the direct proposal programme, applicants, which can be single companies or joint-ventures, submit proposals for their wind and solar projects, which will be implemented on a build-own-operate (BOO) basis. Applicants selected by the government will receive a memorandum of understanding, which will allow them to proceed with feasibility studies and measurement programmes.

MEMR’s efforts to proceed with the second and third round have surprised some as only one power purchase agreement (PPA) for the first round has been completed, with all of the first round scheduled to have been signed off by the end of 2013. In the first week of January 2014, the PPA for a 1MW PV solar plant for the Maan Development Company was signed.

The MEMR’s push with the second and third rounds has been interpreted by some in the market as an attempt to put pressure on the first round bidders to conclude the PPAs and begin executing the projects.

“By releasing the list for the second round first [before completing the first round], may be the government’s way of putting pressure on the companies in the first round to sign the deals and start the projects,” says a source close to the programme.

MEMR began its direct proposal programme for renewable projects in May 2011, when it invited expressions of interest for the first round. After receiving 64 expressions of interest for the first stage, a shortlist of 34 companies and consortiums were compiled. After that, a total of 30 memorandums of understanding were signed calling for a total of 850MW of solar and wind power projects.

From this list 15 PV, two concentrating PV and five concentrated solar power projects, were initially qualified, and eventually 12 PV schemes with an aggregate capacity of 170MW were ultimately approved.

In November 2013, the final agreements were signed for Jordan’s first privately owned renewable energy scheme, the117MW wind farm will be located in the southern governorate of Tafila.

The farm is being developed by the Jordan Wind Project Company, a special-purpose vehicle (SPV) owned by the Euro-Mediterranean fund InfraMed, Abu Dhabi’s Masdar and Cyprus’ EP Global Energy. The project is expected to produce electricity at up to 25 per cent lower cost than traditional thermal power, while avoiding 224,000 tonnes of carbon dioxide annually.

In November, the IFC, part of the World Bank Group, has completed a $221m debt package to support the development of the wind farm. IFC has agreed to provide $69m in loans for the project, and has helped facilitate $79m from other lenders. The wind farm will be Jordan’s first privately owned renewable energy scheme.

In addition to the strategy of using private sector finance to develop its renewable energy projects, Amman is also pushing ahead with projects to build a wind farm and photovoltaic (PV) plant on an engineering, procurement and construction (EPC basis).

In April, MEMR invited companies to prequalify for the contract to build a 65MW-75MW photovoltaic (PV) solar power plant in Quweira, southern Jordan. In January, firms were invited to tender for a PV solar plant at Azraq, located about 100km east of Jordan’s capital city, Amman.