NEXI Provides Insurance for Uzbekistan's Largest Solar Power Plants and BESS

Strategic Insights -

NEXI has decided to provide insurance for loans extended by commercial financial institutions to projects invested by Sumitomo Corporation, Chubu Electric Power Co., Inc., Shikoku Electric Power Company, and ACWA Power Company in Uzbekistan. The projects will construct the largest solar power plants (total capacity: 1,000MW) and Battery Energy Storage Systems (BESS) (total storage capacity: 1,336MWh) in Samarkand and Bukhara regions, with commercial operation targeted to begin in 2027. The electricity generated will be sold to Uzbekistan's state-owned National Electric Grid of Uzbekistan (NEGU) for 25 years under the Power Purchase Agreements.

Key Takeaways:

  • NEXI provides insurance for approximately USD 425 million loan extended by commercial banks, with commercial risk coverage of 97.5% due to its contribution to environmental protection and climate change prevention.
  • The projects are the largest solar power plants and BESS in Samarkand and Bukhara regions, with a total capacity of 1,000MW and storage capacity of 1,336MWh.
  • The projects are expected to contribute to Uzbekistan's goal of increasing the share of renewable energy to 30% of total generation capacity by 2030.
  • NEXI's financial support is expected to expand business opportunities for Japanese companies in Central Asia and maintain the global competitiveness of Japanese businesses in renewable energy development.
  • The projects are in line with the LEAD Initiative, which aims to underwrite insurance of total value of JPY 1 trillion by the end of fiscal year 2025.
  • The signing of the financing agreements for the projects was announced at the 9th Future Investment Initiative (FII) held in Riyadh.
  • ACWA Power Company, a co-investor with Japanese sponsors, is the largest independent power producer (IPP) in the Middle East, operating over 100 assets across 15 countries.

Statistics:

  • Total capacity of the solar power plants: 1,000MW
  • Total storage capacity of the BESS: 1,336MWh
  • Approximate value of the loan extended by commercial banks: USD 425 million
  • Commercial risk coverage: 97.5%
  • Targeted commercial operation date: 2027
  • Duration of Power Purchase Agreements: 25 years
  • Share of renewable energy in Uzbekistan's goal: 30% of total generation capacity by 2030

Sources:

  • NEXI News Release, October 29 [1]
  • [1] NEXI News Release, October 4, 2021
  • [2] NEXI News Release, August 28, 2019
  • [3] NEXI News Release, July 30, 2019