AMMAN — Jordan is unique among its Middle Eastern neighbours. It lacks the large oil and gas fields typically found in its neighbouring countries, forcing it to import almost all of the energy it consumes.

But what Jordan lacks in one resource it makes up for in another: sunshine. Bright days are abundant, with some parts of the country enjoying up to 330 sunny days a year.

Jordan is aware of its solar energy potential and is eager to harness its promise. To diversify its energy mix — reducing its energy dependence while meeting the growing domestic demand for electricity — the government is working with global partners. One of these is the International Finance Corporation (IFC), the investment arm of the World Bank.

Earlier this month, the IFC arranged a $76-million financing package for the construction of a solar plant in northern Jordan that will supply power at 6.9 cents (JD0.05) per kilowatt hour.

This rate is far below the average cost of electricity in the country and among the lowest for solar energy worldwide.

The financing for the 50-megawatt (MW) plant, operated by Fotowatio Renewable Ventures, includes $21 million from the IFC-Canada Climate Change Programme. The plant is expected to start operating in 2018. Its production will be sufficient to power more than 40,000 average homes.

IFC’s investment is the latest in a series of deals to help Jordan boost its domestic energy capacity through renewable energy, the corporation has said in a statement to The Jordan Times.

In November 2013, it supported the country’s first commercial-scale, renewable-power-generation project, the 117MW Tafila Wind Farm, as financier and mandated lead arranger.

Less than a year later, it provided a “major boost to government’s ambitious solar power programme, signing seven deals at once. It was the largest ever private sector-led solar project in the Middle East and North Africa”.

Diversification of the Kingdom’s energy sources has not always been smooth. After recognising the potential of the sun as an energy source, the country launched an ambitious plan to develop a dozen new solar photovoltaic (PV) plants with the private sector.

Despite significant interest in the initiative, securing financing for the individual power plants proved challenging. The plants were small (mostly 10MW to 20MW each) and carried relatively high transaction costs.

In response, the IFC designed an “innovative financial solution to restart solar: We offered to arrange debt for all the projects. Seven of them eventually appointed IFC as their lead arranger. The projects were grouped together and came to be known as Seven Sisters”.

Through the arrangement, developers were able to make use of IFC’s structuring expertise, syndication platform, legal advice and specialists — agreeing to abide by uniform financing terms and a common set of key project documents. All clients benefitted from greatly reduced transaction costs.

In October 2014, the IFC finalised a $207.5-million debt package to finance construction of all seven plants. The initiative is so far the largest ever collection of privately owned solar PV projects to be realised in the Middle East and North Africa region.

The programme has paved the way for subsequent rounds of competitive renewable energy projects in Jordan. The seven plants are now operational, providing clean, cheap solar power, and helping the country replace imported fossil fuels.