Masdar to push ahead with alternative power plants by March

18 January 2010

Deals for solar and hydrogen plants worth a total of $2.8bn

Abu Dhabi Future Energy Company (Masdar) will push ahead with $2.8bn worth of alternative power schemes before the end of March, a senior executive at the company confirms to MEED.

Masdar plans to build two alternative power plants as part of its Masdar carbon neutral city.

Frank Wouters, associate director of Masdar’s power division, says it plans to award a construction contract for the first of these, the Shams 1 solar power plant, by the end of March.

Speaking on the sidelines of the Abu Dhabi Future Energy Summit on 18 January, he tells MEED that Masdar also wants to start the tender process on a hydrogen power plant by the end of the March.

The timeline represents a delay for both projects.

According to Wouters the solar power award has been delayed by a need for clarity on solar power regulations in the UAE.

“What we face with Shams is a lack of regulatory framework,” he told MEED. “In Spain, for example, you know what the rules are for plants but in this case part of what we are doing at Masdar is creating the regulations from scratch.”

Wouters said the deal for the hydrogen power plant has been delayed by the need for the partners to set up financing on the project.

“That would be the plan [to tender the deal by the end of the quarter],” Wouter said. “But we need to fix the financial side of things before we can push ahead.”

A final agreement on the hydrogen project is likely to be reached early in the second quarter of 2010, said Katrina Landis, head of alternative energy at BP, at a press conference later the same day.

“We are still negotiating commercial terms,” she said. “I would hope to get commercial clarity within the next two months.”

The Shams 1 concentrated solar power plant will produce 100MW of electricity at Madinat Zayed in the west of Abu Dhabi. The project is valued at $550m by MEED Projects, which tracks project activity across the region.

The second project is a 60:40 joint venture with the UK’s BP, known as Hydrogen Power Abu Dhabi (HPAD). On completion this will be the world’s biggest hydrogen power plant, breaking down natural gas into its component parts including hydrogen, which will then be used to produce 400MW of power.

Sources close to the scheme say it is worth $2.2bn. It will be built at a site 250km west of Abu Dhabi.

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