UAE's Masdar seeks to double renewable capacity in 3-5 years

Dubai — UAE's clean energy company Masdar, owned by an Abu Dhabi sovereign wealth fund managing $232 billion in assets, plans to double its renewable energy capacity from the current 10.7 GW in three to five years through global expansion, a company official said Dec. 21.

Masdar, which has doubled its capacity in the last two years and currently has a $20 billion portfolio, is expanding globally through projects such as its first floating solar project in Indonesia, Yousif al-Ali, executive director of clean energy at Masdar, said at a virtual media briefing.

"We think in order for Masdar to continue its leadership in renewable energy we will be required to continue on the same approach," said Ali. "We have the right pace to target the doubling of capacity or maybe more."

Masdar, which was set up by the Abu Dhabi government in 2006 and is owned by Mubadala Investment Company, currently operates in over 30 markets spanning the UK, where it has stakes in three wind farms, to Australia, where it acquired a 40% stake in a waste-to-energy project for A$511 million ($385 million).

Biggest international market

The UK is Masdar's biggest international market outside the UAE, with renewable energy projects totaling almost GBP4 billion ($5.3 billion), and a combined capacity of over 1 GW.

Masdar is banking on global growth in renewable energy for power generation to drive its expansion, with Western Europe a key market for offshore wind projects, according to Ali.

Electricity generation from renewables is forecast to continue to set new records in 2021, growing its market share to 29% from 28% in 2020 and increasing by more than 6% next year from 2020 levels, according to the International Energy Agency.

Renewable electricity generation is projected to grow by almost 7% in 2020, squeezing conventional generation, according to the IEA.

Masdar is also expanding into new regions with a joint venture in Indonesia to build the country's first floating solar project. It wants Indonesia to be a launchpad for investments in Southeast Asia, which is well suited for floating solar projects, said Ali.

Israeli market

The company also wants to expand into Israel, with which the UAE established commercial ties this year following the signing of a peace agreement in September.

"The Israeli market has the right legislation and the right guarantees also to support any investment in the country," said Ali.

The next step for Masdar is to strike partnerships in Israel, whether with local or international companies, and participate in auctions launched by the government in this market, he added.

Closer to home, Masdar is bidding for Saudi Arabia's third renewables round, which includes solar projects that have a collective capacity of 1.2 GW, and plans to submit an offer by the first quarter of 2021.

Masdar, along with EDF Renewables, won in 2019 a 400 MW wind project in Saudi Arabia, the country's first such farm, which is expected to start power generation in the coming months.

Masdar is bidding for projects despite the pandemic, which has delayed a number of developments under construction by a few months, Ali said.

"We faced certain delays across all our projects in different regions because of restrictions when it comes to transportation," he said. "I think we have overcome this challenge and are progressing very well in our projects."