EBRD to provide ACWA Power with $65 mln for green hydrogen project in Uzbekistan
TASHKENT. Aug 28 (Interfax) - The European Bank for Reconstruction and Development is providing a financial package of $65 million or 58 million euros to the Uzbek-Saudi Arabian ACWA Power UKS Green H2 to deliver the pilot renewable hydrogen project in Uzbekistan, the EBRD said in a press release.
"The new facility in Uzbekistan will help replace grey hydrogen, produced from natural gas and widely used in the production of ammonia fertilizer, with renewable hydrogen. The latter is recognized as a key alternative for decarbonizing the fertilizer production sector. Once operational, the facility is expected to produce up to 3,000 tonnes of renewable hydrogen annually and to reduce annual CO2 emissions by around 22,000 tonnes," the EBRD said.
The facility will consist of a 20 MW electrolyzer and a greenfield 52 MW wind power plant.
The funds are being provided to ACWA Power UKS Green H2 for the development, design, construction and operation of the facility. This special purpose company is jointly owned by ACWA Power and Uzkimyosanoat, a holding company of state-owned chemical enterprises in Uzbekistan.
The package consists of a $55 million (49 million euros) senior loan provided by the EBRD as well as concessional finance of up to $10 million (9 million euros) from Canada under the Special Fund for the High Impact Partnership on Climate Action (HIPCA).
The EBRD is also planning to provide an equity bridge loan of up to $5.5 million (4.9 million euros) for the project.
"This is the first [project] of its kind across Central Asia, a region with some of the most carbon-intensive and hard-to-abate industries," said Nandita Parshad, EBRD Managing Director for the Sustainable Infrastructure Group.
The Uzbek Energy Ministry signed agreements with ACWA Power and the U.S. Air Products in 2021 to develop hydrogen energy in the country. In August 2022, the parties signed another agreement - on the commercial production of "green" hydrogen at an ammonia plant in Chirchiq, Tashkent region. In addition, there are plans to organize the environmentally friendly production of ammonia, which will save an estimated 600 million cubic meters of gas annually and reduce carbon dioxide emissions by 1.5 million tonnes.
The $88 million green hydrogen project got underway in November 2023 with launch is planned in 2025.