The European Bank for Reconstruction and Development (EBRD) is providing a $95 million financing to support the construction of a 485 MW CCGT plant in Jordan.
The loan will be provided to Mahatat Al Zarqa Le Tawleed Al Takah Al Kahrabaieyah, a limited liability company incorporated in Jordan and majority-owned by ACWA Power International, a major international energy company, EBRD said.
The new thermal power station will be located 40 kilometres north-east of the capital Amman.
Through the loan, the EBRD aims to help “to address energy security and climate change challenges in Jordan” EBRD explained, adding that the new Zarqa combined-cycle gas turbine plant replaces the obsolete Hussein thermal power station and will be “twice as efficient.”
The new plant involves a fuel switch from oil to natural gas that will result in significant greenhouse gas emission savings in the country, it said.
“Additional energy-efficient replacement power is essential to the stability of the Jordanian electricity network to address a rapidly growing demand on the back of the influx of refugees from neighbouring Syria and as older, less efficient plants are being decommissioned” the bank pointed out.
“The investment will also play an important role in Jordan’s transition to a low-carbon economy, because the new plant will also increase the required base load power in the country” it said. “This in turn will facilitate the successful integration of more renewable sources of energy in the system.”
The EBRD has been a strong supporter of sustainable development within Jordan’s energy sector since 2012, including financing six solar power plants (for a total of 164 MW), one wind power plant (82 MW) and one 240 MW thermal power plant. The latter, IPP4, was the Bank’s first investment in the country in 2012, it said.
“This will be the largest energy project financed by EBRD in Jordan to date and it will support the government’s goal of meeting rapid electricity demand growth” commented Nandita Parshad, EBRD director for power and energy.
“It will also provide a highly competitive electricity price and help the grid manage the increasing share of renewables in the Jordanian energy mix.”
This investment brings the total capacity of energy projects financed by the EBRD in Jordan to 971 MW.