Narrative
Full Description
Project narrative
On March 29, 2023, ACWA Power Bash Wind Limited Liability Company (or FE ACWA Power Bash Wind LLC) — a special purpose vehicle and wholly-owned subsidiary of ACWA Power that is legally incorporated in Uzbekistan — signed a $463 million syndicated debt financing package (including A and B loans) with the Asian Development Bank (ADB), Bank of China (BOC), Industrial and Commercial Bank of China (ICBC), the European Bank for Reconstruction and Development (EBRD), Standard Charted Bank, the OPEC Fund for International Development Bank, Deutsche Investitions- und Entwicklungsgesellschaft mbH (DEG), and PROPARCO for the 500MW Bash Wind Farm, 500kV Bash-Karakul Overhead Transmission Line (OHTL), and 33-500kV Substation IPP Project. BOC contributed an estimated $68.25 million to the syndicate, while ICBC contributed an estimated $95 million to the syndicate. The borrower purchased credit insurance from the Multilateral Investment Guarantee Agency (MIGA). The total cost of the independent power project (IPP) was $690 million and it was financed according to a debt-to-equity ratio of 67:33. The purpose of the project is to construct the 500MW Bash wind farm in the Gijduvan district of Bukhara region. The wind farm is expected to consist of 79 wind turbine generators (WTGs), each with a capacity of 6.5 MW linked to an onsite 500 kilovolt (kV) switchyard. The proposed WTG model for the project is the Envision Energy with a hub height of 100 meters (m) and a rotor diameter of 171 m. The Bash wind farm is expected to be connected to the national grid via a 162 km single circuit 500 kV overhead transmission line (OHTL) that runs from an onsite substation (Bash substation, to be built) to the existing Karakul substation (Bash-Karakul OHTL), located south of the Bash wind farm. Additional components of the project under the responsibility of the PE include: (i) ancillary facilities including office buildings (security, administration, control room among others), warehouses, stores and laydown area; (ii) internal access roads 6 m wide between turbines, approximately 80 km in total; (iii) electrical connection facilities comprising a 500kV switchyard and the 33/500kV substation that will connect Bash wind farm to the single circuit 500kV OHTL. ACWA Power has already entered into a 25-year, USD-indexed, Power Purchase Agreement (PPA) with National Electric Grid of Uzbekistan (NEGU). NEGU is expected to be the sole off-taker of the power generated by Bash Wind Farm. Once Bash Wind Farm is operational, it is expected to increase electricity production in the country from 12.9GW in 2019 to 29.3GW by 2030. The project site is located approximately 0.5 km east of Lake Ayakagitma (an Important Bird Area (IBA) and Key Biodiversity Area (KBA) in the Kyzylkum desert. The project was allocated an area of 285.1 hectares (ha); however, the wind farm footprint is expected to consist of approximately 178 ha. The landscape of the project site is predominantly open desert with low lying shrub and grass vegetation. The site is surrounded by cliffs on the western side that slope towards Lake Ayakagitma. The area supports breeding and resident populations of vultures and raptors that are of international and national conservation significance. The area is sparsely populated with three villages located in the vicinity of the project but none within the project site. The villages include: Kuklam (1.6 km); Ayakagitma village (4.6 km) and Chulobod village (10 km). The Engineering Procurement and Construction (EPC) contract of the Bash Wind project was awarded to China Energy International Group (CEEC), while First National Operation and Maintenance was selected as the operations and maintenance (O&M) company. In June 2023, renewable energy company Envision Energy announced that it will supply the turbines for the wind project. Capitals Environmental and Management Consulting (5 Capitals) acted as the lead E&S Consultant undertaking the independent Environmental Impact Assessment (EIA) and Environmental and Social Impact Assessment (ESIA) processes. The pre-feasibility study for 500kV overhead transmission line of the wind project was prepared by Juru Energy. MIGA prepared the Environmental and Social Review Summary (ESRS). The EPC contractor received full notice to proceed in October 2022. However, the project’s groundbreaking ceremony did not take place until March 9, 2023. The first wind turbine was installed in August 2023. Bash Wind Farm is expected to begin commercial operations in December 2024.
Staff comments
1. On July 7, 2023, ACWA Power (through its wholly owned subsidiary) entered into a Sale Purchase Agreement (“SPA”) for the sale of a 35% stake in its wholly owned subsidiaries, ACWA Power Bash Wind Project Holding Company and ACWA Power Uzbekistan Wind Project Holding Company Limited (“the Investee Companies”). The Investee Companies holds 100% stake in ACWA Power Bash Wind LLC and ACWA Power Dzhankeldy LLC (“the Project Companies”) respectively. The disposal was subject to the satisfaction of certain conditions precedent in the SPA, which were not completed as of December 31, 2023. 2. The Chinese project title is 乌兹别克斯坦巴什500兆瓦风电项目. 3. The estimated size of ICBC’s financial contribution is drawn from IJGlobal. 4. According to BOC, it contributed $136.5 million: one for the 500MW Bash Wind Farm, 500kV Bash-Karakul Overhead Transmission Line (OHTL), and 33-500kV Substation IPP Project and another for the 500MW Dzhankeldy Wind Farm, 33-500kV Substation, 500kV Dzhankeldy-Bash and Dzhankeldy Western Plot-Eastern Plot Substations OHTL IPP Project. For the time being, AidData assumes that BOC’s contributions were equally divided across the two projects. This issue warrants further investigation. 5. Once operational, the wind farm is expected generate more than 1,650GWh of electricity annually and help in reducing carbon dioxide emissions by 930,000 tons per year. 6. Previously, the project design included 111 WTGs. However, the count was reduced by 32 units during the design review to reduce environmental and social impacts. The wind turbines will have a hub height of 100m and a rotor diameter of 171m. They will be capable of adapting different speeds, pitches and advanced control strategies. The main components and facilities of the wind farm will include turbine blades, generator, generator rotor, generator stator, nacelle, brake system, yaw system, converter system, tower, and transformer, along with other ancillary facilities. 7. There is some evidence of an additional RMB 2.5 billion bridge loan from China Energy Engineering Corporation Limited to China Energy International Group Co., Ltd. (中能建国际建设集团有限公司) in 2023 for the 500MW Bash Wind Farm, 500kV Bash-Karakul Overhead Transmission Line (OHTL), and 33-500kV Substation IPP Project as well as the 500MW Dzhankeldy Wind Farm, 33-500kV Substation, 500kV Dzhankeldy-Bash and Dzhankeldy Western Plot-Eastern Plot Substations OHTL IPP Project (see https://www1.hkexnews.hk/listedco/listconews/sehk/2023/0310/2023031000422.pdf and https://www.seetao.com/details/206506.html).This issue warrants further investigation.