State owned Saudi Electric has secured $3bn to help it build smart grids throughout the kingdom.

The money comes from an international syndicated facility agreement with four banks in the region – Dubai Islamic Bank PJSC, Kuwait Finance House, Mashreq Bank PSC and Saudi National Bank.

The financing agreement has a tenure of five years and requires no guarantees from Saudi Electric.

“Our investments’ primarily focus on building smart grids, integrating renewable energy projects and improving the gird reliability, altogether will provide the essential infrastructure for the transmission and distribution grids to further boost electricity generation efficiency levels and achieve optimal electricity production, in line with the goals of Vision 2030,” said Khaled Al-Gnoon, CEO of Saudi Electric.

The financing comes in line with its investment strategy aimed at injecting approximately $130bn in the electricity sector and capex spend by 2030 to provide better electricity services to subscribers. This should boost the growth of the company’s regulated asset base, a move anticipated to fortify its financial position and prospects for revenue growth.

“Furthermore, these investments translate into a myriad of environmental and societal co-benefits, affirming the designation of many of these investments as green and eco-friendly ventures,” said Al-Gnoon. “Our objective is to create a diversified portfolio, continuing to invest in energy production and progress in the liquid displacement programme, in alignment with the kingdom’s ambitious energy transition plans.”

He said Saudi Electric (www.se.com.sa) would continue to leverage the company’s multi-decade expertise in the electricity sector and its asset base to unlock additional growth opportunities from new business segments, such as fibre optics telecoms and ICT services, energy services, and the provision of the necessary infrastructure for electric vehicles.

“The company’s robust financial profile and well-balanced capital structure, supported by favourable regulatory and financial reforms implemented in the electricity sector, optimally position it to successfully fund future growth plans and enhance returns for its shareholders,” he said. “We are pleased with the significant interest from leading banks in the region to partner with us and to successfully close this financing deal with favourable terms and pricing. This underscores the company’s strong credit profile and strengthens the continued collaboration between Saudi Electric and its financing partners.”