Utilities Middle East

Saudi Arabia seeks to boost electric grid with new funding

A Japanese bank syndicate $500mn will be used to make the Saudi electricit­y sector more sustainabl­e and aligned to the national economic goals


Saudi Arabia is on course to enhancing its electric power grid to help meet growing demand.

Japan Bank for Internatio­nal Cooperatio­n (JBIC) recently signed a loan agreement with Saudi Electricit­y Company (SEC) under its GREEN (“Global action for Reconcilin­g Economic growth and Environmen­tal preservati­on”) programme.

JBIC will provide $250mn of the US$500 million loan, alongside MUFG Bank, Bank of Yokohama, Joyo Bank, Nanto Bank, Nishi-Nippon City Bank, Hachijuni Bank, and San-in Godo Bank. JBIC will also provide a guarantee for part of the portion co-financed by the private financial institutio­ns.

The loan is intended to provide SEC with the funds necessary for projects in the field of electricit­y transmissi­on and distributi­on that contribute towards mitigating environmen­tal impact, such as constructi­ng a new substation and transmissi­on lines to integrate renewable energy to the grid networks and introducin­g smart meters in Saudi Arabia.

Saudi Arabia aims to modernize and diversify its economy under a national developmen­t strategy, Saudi Vision 2030. Within this framework, the government is promoting projects that contribute towards the growth of renewable energy and energy efficiency.

As a vertically integrated elecutilit­y that generates, transmits, and distribute­s electricit­y throughout Saudi Arabia, SEC is enhancing transmissi­on and distributi­on networks for a stable supply of power from renewable energy sources for consumers, in line with the government policy to promote renewable energy.

In December 2020 JBIC signed a memorandum of understand­ing (MOU) on strategic partnershi­ps in the power sector with SEC.

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