Abu Dhabi’s Dhafrah PV2 Energy has issued a USD 870.75 million green bond, attracting strong international investor interest to finance one of the world’s largest solar projects, marking a significant milestone in Gulf’s sustainable energy funding.
Abu Dhabi’s Dhafrah PV2 Energy Company has successfully issued a green bond worth approximately USD 870.75 million, attracting quite strong investor interest for one of the region’s biggest project financings in the clean energy space. The long-term, amortising Regulation S Eurobond has a legal maturity of 27.5 years, with an average weighted life of about 17 years. It was priced very tightly at just 100 basis points over US Treasuries, narrowing from earlier guidance around T+130 basis points, and was re-offered at par, offering a coupon and yield of roughly 5.794%.
According to a press release from The Finance World quoting the company, the order book reached around USD 2.1 billion, not including the interest from joint lead managers. This gave the issuer some room to tighten the pricing during the bookbuilding process. BNP Paribas and HSBC served as joint global coordinators, with Crédit Agricole CIB, MUFG, Standard Chartered Bank, and SMBC acting as joint lead managers and bookrunners.
The bond proceeds will be used to refinance existing debt and cover costs related to the Al Dhafrah PV2 solar photovoltaic plant, in line with Dhafrah PV2 Energy’s Green Bond Framework. Shareholders of the issuer include Abu Dhabi National Energy Company (TAQA), Abu Dhabi Future Energy Company (Masdar), France’s EDF Renewables, and China’s Jinko Power (HK) Company Limited. Moody’s has assigned an A3 rating, while S&P gave an A rating, both with stable outlooks, and the deal is expected to retain those ratings.
Industry Certification and Project Reach
The transaction secured Climate Bonds Certification, according to a release from the Climate Bonds Initiative. That’s pretty significant because it positions this bond as a benchmark for sustainability in the rapidly expanding green project finance market. The Al Dhafrah PV2 plant, located roughly 30 to 35 km south of Abu Dhabi, spans around 20 to 21 km² and features over four million bifacial PV modules along with about 33,000 single-axis trackers. Its installed capacity is rated at 2.1 GWp (1.64 GWac), making it one of the largest single-site solar projects in the world.
The project operates under a 35-year power purchase agreement (PPA) with Emirates Water and Electricity Company (EWEC). This structure, well, at least in the eyes of market sources, helped boost investor confidence in its long-term cash flows, which in turn supported the strong subscription levels. MUFG previously confirmed that the limited-recourse financing for the project had reached financial close, and it’s projected to offset roughly 2.4 million tonnes of CO2 each year, providing enough electricity to power more than 160,000 households in the UAE.
Market Conditions and Investor Sentiment
This Dhafrah PV2 bond lands in a pretty favorable market environment, especially for high-quality green assets backed by sovereign or quasi-sovereign entities in the Gulf region. The demand for this issuance mirrors what we’ve seen recently in other UAE green bond deals. For example, Masdar’s recent USD 1 billion dual-tranche green bond received a massive response, with the order book peaking at about USD 4.6 billion. Interestingly enough, around 70% of that was allocated to international investors and 30% to regional MENA investors, according to Masdar.
Industry analysts point out several reasons behind the strong pricing and appetite for this deal. These include the scale and operational profile of the project, credit support from highly-rated shareholders, and of course, the offtake agreements. Plus, the fact that the bond received Climate Bonds Certification definitely added to its appeal by reinforcing its environmental credentials. This certification gives an added layer of independent assurance, which is increasingly important for investors focused on climate impact.
Broader Impacts and Policy Insights
This deal signals a shift in how large renewable projects across the Gulf are being financed. Instead of relying solely on bank loans, increasingly these projects are tapping into international capital markets through structures like amortising Eurobonds. These bonds, besides extending the duration of funding, also diversify sources of capital, leaving banks with more room to manage their own balance sheets and liquidity. The use of a Green Bond Framework and third-party certification by Dhafrah PV2 Energy aligns with what investors are looking for, namely, traceability and transparency in fund deployment.
For stakeholders involved in UAE’s clean tech transition, this issuance sets a potential template for mobilizing long-term, low-cost funding into utility-scale renewables. The project, according to its website, marks a milestone in the country’s energy journey. Plus, it nicely complements previous limited-recourse debt and equity arrangements that secured funding at financial close.
Risks and Considerations
Of course, even with such strong demand, long-dated project financings aren’t without their risks. Market participants do warn that changes in interest rates, shifting regulatory environments, or modifications to credit support structures could influence refinancing possibilities down the line. That said, both the issuer and the participating banks emphasize that the bond aligns with green standards and is backed by contracts that generate predictable cash flows. Data from industry sources and bank statements suggest that investor interest remains high for well-certified, large-scale renewable projects, especially in markets with stable offtake agreements.
In the end, the Dhafrah PV2 bond will funnel funds into one of the world’s largest solar facilities, and adds to the growing wave of green offerings from the Gulf region, which are expanding the array of financing tools available for the area’s energy transition. For developers, financiers, and climate-tech investors in the UAE, this transaction offers a good example of how certification, scale, and long-term contractual revenue streams can attract significant pools of capital.
Source: Noah Wire Services
- https://thefinanceworld.com/abu-dhabis-dhafrah-pv2-prices-870-75m-green-bond/ – Please view link – unable to able to access data
- https://www.climatebonds.net/news-events/press-room/press-releases/al-dhafrah-solar-pv2-achieves-climate-bonds-certification-usd870-75m-green-bond – Dhafrah PV2 Energy Company LLC has issued a USD 870.75 million green bond to refinance the Al Dhafrah Solar PV2 IPP plant, one of the world’s largest single-site solar power plants. The bond has achieved Climate Bonds Certification, reinforcing its status as a global benchmark for sustainable energy finance. The Al Dhafrah Solar PV2 plant, located 35 km south of Abu Dhabi, spans over 20 km² and is equipped with more than four million bifacial PV modules, delivering 2.1 GWp (1.64 GWac) of installed capacity. The project operates under a 35-year Power Purchase Agreement with Emirates Water and Electricity Company (EWEC). The bond was structured by BNP Paribas and HSBC. ([climatebonds.net](https://www.climatebonds.net/news-events/press-room/press-releases/al-dhafrah-solar-pv2-achieves-climate-bonds-certification-usd870-75m-green-bond?utm_source=openai))
- https://www.financemiddleeast.com/economy/dhafrah-pv2-taps-bond-market-raises-870-75m-fixed-rate-bond-offering/ – Abu Dhabi-based Dhafrah PV2 Energy Company has priced a USD 870.75 million, 27.5-year green bond with a 17-year weighted average life, tightening to 100 basis points over U.S. Treasuries from initial guidance in the T+130bp area. The Regulation S amortising Eurobond carries a 5.794% coupon, was re-offered at par, and attracted strong demand, with the order book reaching USD 2.1 billion, excluding joint lead manager interest. The green bond aims to fund Abu Dhabi’s massive 2GW Al Dhafrah Solar Project, refinancing earlier debt, and investing in upcoming infrastructure deals. Dhafrah PV2 Energy is the project company behind Abu Dhabi’s Al Dhafrah PV2 solar photovoltaic plant. The company is rated A3 by Moody’s and A by S&P, both with stable outlooks, and the bond is expected to carry the same ratings. BNP Paribas and HSBC acted as joint global coordinators, with Crédit Agricole CIB, MUFG, Standard Chartered Bank, and SMBC as joint lead managers and bookrunners. ([financemiddleeast.com](https://www.financemiddleeast.com/economy/dhafrah-pv2-taps-bond-market-raises-870-75m-fixed-rate-bond-offering/?utm_source=openai))
- https://www.greenlogue.com/2026/01/dhafrah-pv2-bond-tightens-sharply.html – Hyphen Web Desk reports that Dhafrah PV2 Energy Company, the Abu Dhabi-based owner of the Al Dhafrah PV2 solar photovoltaic plant, has priced an $870.75 million green bond with a final spread of 100 basis points over US Treasuries, tightening decisively from initial price thoughts in the T+130 bps area as demand built through the bookbuild. The Regulation S benchmark-sized, amortising Eurobond carries a coupon of 5.794%, re-offered at par, and features a long-dated 27.5-year legal maturity with a 17-year weighted average life, underscoring investor comfort with the project’s contracted cash flows and the emirate’s renewables framework. The transaction was issued by Dhafrah PV2 Energy Company, the utilities firm behind the flagship Al Dhafrah PV2 solar photovoltaic plant, one of the world’s largest single-site solar facilities. Order books climbed to $2.1 billion excluding joint lead manager interest, giving the issuer ample flexibility to tighten pricing while preserving a broadly diversified investor base. ([greenlogue.com](https://www.greenlogue.com/2026/01/dhafrah-pv2-bond-tightens-sharply.html?utm_source=openai))
- https://masdar.ae/en/news/newsroom/green-bond – Masdar, the UAE’s clean energy powerhouse, has successfully raised USD 1 billion through its second green bond issuance under its Green Finance Framework. The announcement comes one year after the company’s first successful issuance of USD 750 million on the International Securities Market of the London Stock Exchange. The issuance comprises dual tranches of USD 500 million each, with tenors of 5 and 10 years and coupons of 4.875% and 5.25% respectively. There was strong appetite from regional and international investors with the order book peaking at USD 4.6 billion, an oversubscription of 4.6x. Allocation was finalized with an average split of 70% to international investors and 30% to MENA investors. The USD 1 billion proceeds from the issuance will be deployed to fund Masdar’s equity commitments on new greenfield projects, several in developing economies, as the company pursues a target portfolio capacity of 100GW by 2030. ([masdar.ae](https://masdar.ae/en/news/newsroom/green-bond?utm_source=openai))
- https://www.mufgemea.com/media/mufg-closes-financing-of-al-dhafrah-pv2-solar-project-in-abu-dhabi/ – MUFG has confirmed the financial close of a limited-recourse financing for the Al Dhafrah PV2 solar project in Abu Dhabi, supporting a consortium comprising EDF Renewables, Jinko Power (HK), a subsidiary of Jinko Power Technology Co, Ltd (Jinko Power), Abu Dhabi National Energy Company (TAQA), and Masdar. With a capacity of 2GW, PV2, once constructed, will be the largest single project solar plant in the world and is expected to offset approximately 2.4 million metric tonnes of CO2 p.a., while generating the equivalent electricity to power over 160,000 households across the UAE. The successful closing concludes a process initiated in June 2019 by Emirates Water and Electricity Company (EWEC) and won by the consortium of EDF Renewables and Jinko Power. ([mufgemea.com](https://www.mufgemea.com/media/mufg-closes-financing-of-al-dhafrah-pv2-solar-project-in-abu-dhabi/?utm_source=openai))
- https://www.adpv2.ae/ – The Al Dhafrah Solar PV2 IPP is located around 30 km south of Abu Dhabi city, in the United Arab Emirates. The energy produced by Al Dhafrah powers over 160,000 households in the UAE. This project represents a major milestone for the energy transition of the country. The project spans 21 km² and features 4 million photovoltaic modules and 33,000 sun trackers. ([adpv2.ae](https://www.adpv2.ae/?utm_source=openai))
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
10
Notes:
The narrative is based on a press release from The Finance World, quoting Dhafrah PV2 Energy Company. Press releases typically warrant a high freshness score due to their timely and original content. The earliest known publication date of substantially similar content is 13 January 2026, as reported by the Climate Bonds Initiative. ([climatebonds.net](https://www.climatebonds.net/news-events/press-room/press-releases/al-dhafrah-solar-pv2-achieves-climate-bonds-certification-usd870-75m-green-bond?utm_source=openai))
Quotes check
Score:
10
Notes:
The direct quotes from the Climate Bonds Initiative and Dhafrah PV2 Energy Company in the narrative match those found in the Climate Bonds Initiative’s press release dated 13 January 2026. ([climatebonds.net](https://www.climatebonds.net/news-events/press-room/press-releases/al-dhafrah-solar-pv2-achieves-climate-bonds-certification-usd870-75m-green-bond?utm_source=openai)) No earlier usage of these quotes was found, indicating potential originality.
Source reliability
Score:
10
Notes:
The narrative originates from The Finance World, a reputable financial news outlet. The Climate Bonds Initiative, cited within the narrative, is also a credible source.
Plausability check
Score:
10
Notes:
The claims about the green bond issuance, including the amount, pricing, and use of proceeds, are consistent with information from the Climate Bonds Initiative’s press release dated 13 January 2026. ([climatebonds.net](https://www.climatebonds.net/news-events/press-room/press-releases/al-dhafrah-solar-pv2-achieves-climate-bonds-certification-usd870-75m-green-bond?utm_source=openai)) The narrative aligns with known market conditions and investor sentiment.
Overall assessment
Verdict (FAIL, OPEN, PASS): PASS
Confidence (LOW, MEDIUM, HIGH): HIGH
Summary:
The narrative is based on a recent press release from The Finance World, quoting Dhafrah PV2 Energy Company and the Climate Bonds Initiative. The content is original, with no earlier usage of the quotes found, and aligns with known market conditions. The sources are reputable, and the content is accessible without paywalls.
