Dubai, UAE – Standard & Poor’s Global credit rating agency confirmed that the credit quality of water and energy projects in Abu Dhabi is immune to operational risks. Due to its high levels of credit flexibility supported by strong contractual structures that ensure stable cash flows.
The agency explained that projects that include independent water and energy producers and solar photovoltaic projects benefit from well-established contractual frameworks that provide effective protection against risks. Including the repercussions of geopolitical situations.
The agency indicated in a report that the four projects it classifies, namely: Al Ruwais Energy, Emirates Sumpcorp Water and Energy, Suwaihan Solar Energy, and Al Dhafra Solar Energy 2, all continue to operate with high efficiency without recording any material damage or effects on production. While maintaining strong levels of operational stability.
The agency ruled out a fundamental impact on the creditworthiness of these projects, within a scenario in which regional unrest is expected to continue during the coming period. This is in light of the strength of the contractual foundations and the institutional support associated with them.
The agency reported that the contractual frameworks across the four projects reflect a well-established model, characterized by an appropriate distribution of risks and strong participation from parties linked to the government. Noting that the revenue models in these projects, whether based on availability or “receive or pay” mechanisms, provide stable and predictable cash flows. Supported by long-term purchase agreements, enhancing revenue visibility and sustainability.
The agency also noted that the four projects enjoy high operational flexibility, supported by the availability of spare parts and inventory at their sites. High automation in solar energy projects contributes to enhancing continuity of operations even in exceptional circumstances.
