Masdar achieves financial close on Uzbekistan’s first utility-scale wind farm

Masdar, one of the world’s leading renewable energy companies, announced today that it has achieved financial close on the 500-megawatt (MW) Zarafshan wind project – Uzbekistan’s first utility-scale wind farm.

The announcement was made following a ceremony to mark the occasion, held in Tashkent, the Uzbek capital. His Excellency Jamshid Khodjayev, Deputy Prime Minister, and Minister of Investments and Foreign Trade for the Republic of Uzbekistan, gave the keynote address at the event, with Niall Hannigan, Chief Financial Officer for Masdar, also speaking. HE Shukhrat Vafaev, Deputy Minister of Investments and Foreign Trade, and HE Sherzod Khodjaev, Uzbekistan’s Deputy Minister of Energy, also attended.

 “Uzbekistan is aiming to derive 25 percent of its energy from renewable sources by 2026, and we are grateful to Masdar and financial institutions who are contributing to this goal through solar, wind, and other renewable energy projects,” said HE Shukhrat Vafaev, Deputy Minister of Investment and Foreign Trade. “Going forward, we will continue to work with lenders, development partners, and the private sector to promote renewable energy solutions to fuel Uzbekistan’s green growth.”

Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, said, “Today we are celebrating reaching a significant milestone in this landmark project, one that takes Uzbekistan a step closer to achieving its ambitious renewable energy goals. Uzbekistan is a key strategic investment destination for Masdar, and we look forward to continuing to develop and grow our strong portfolio of projects in the nation. This achievement would also not have been possible without the support of our anchor lenders, the European Bank for Reconstruction and Development (EBRD), the International Finance Corporation (IFC), the Asian Development Bank (ADB), and Japan International Cooperation Agency (JICA), to whom we owe many thanks. We are also especially grateful to Etihad Credit Insurance (ECI), whose participation facilitates the diversification of the foreign capital mix being invested into Uzbekistan, both from within the UAE and elsewhere.” 

Alongside the anchor lenders for the Zarafshan project, the Dutch Entrepreneurial Development Bank, FMO, is acting as B lender, while Etihad Credit Insurance, Natixis and First Abu Dhabi Bank (FAB), are providing credit-insured lending for the project. 

Sir Massimo Falcioni, Chief Executive Officer of Etihad Credit Insurance, said “We are honored and truly delighted to support the Republic of Uzbekistan in reaching its clean-energy objectives, by providing to the UAE renewable energy champion Masdar the requested credit insurance facility to develop this landmark project for 500-megawatt wind farm in Zarafshan, the largest renewables project in Central Asia. With this successful financial closing, Masdar confirms to be one of the fastest-growing renewable energy companies in the world. This milestone project financial closing comes just few weeks after His Excellency Mohammed Al Gergawi, Minister of Cabinet Affairs, lead a UAE delegation to Tashkent to sign an extension to the partnership with Uzbekistan, including other areas of strategic partnership like financial sector; education; economy; government leadership; food security and agriculture, and ports and customs”.

Masdar entered into bilateral agreements with the Government of Uzbekistan in 2020 to develop, build and operate the Zarafshan wind farm, the largest renewables project in Central Asia. The project is expected to attract foreign direct investment of more than US$600 million, and is part of Uzbekistan’s effort to meet 25 percent of its electricity needs from renewable sources by the end of the decade. 

The Zarafshan wind farm is Masdar’s second utility-scale project in Uzbekistan, with the 100 MW Nur Navoi Solar Project – Uzbekistan’s first successfully-financed independent power producer (IPP) solar project – starting operations last year. Masdar also signed agreements last year to develop additional photovoltaic (PV) power projects in Uzbekistan with a combined capacity of 890 MW. The projects will be located in the Samarkand, Jizzakh and Sherabad regions of Uzbekistan.

The 500 MW Zarafshan wind farm, which is expected to begin commercial operation by the end of 2024, will provide enough electricity to power 500,000 homes, while displacing 1.1 million tonnes of carbon dioxide per year. Masdar signed the Power Purchase Agreement (PPA) and Investment Agreement for the Zarafshan wind farm with the Ministry of Investments and Foreign Trade of the Republic of Uzbekistan and JSC National Electric Grid of Uzbekistan in June 2020. 

Masdar is one of the fastest-growing renewable energy companies in the world with the expectation of reaching well over 50 GW total capacity by 2030 – and over 100 GW in the following years. In December 2021, the UAE government announced Abu Dhabi energy champions TAQA, ADNOC, and Mubadala are to join forces as shareholders in Masdar, creating a global clean energy powerhouse that will be a major force in renewables and green hydrogen.