Korea’s OCI, Israel’s Arava Power to jointly build solar cell plant in Texas

OCI Energy Co., a US subsidiary of South Korea’s OCI Holdings Co., and Israel’s Arava Power will jointly build a solar cell power plant in Texas.

OCI Energy said on Monday it has signed a joint venture agreement with Arava Power to push the SunRoper Project, a large-scale solar power plant in Texas.

The project, which is building a solar cell power plant on 17,000 acres near Houston, will generate 260 megawatts of electricity, enough to power around 40,000 US households annually.

The two companies will launch a 50-50 joint venture, in which they share investment costs.

Once construction is completed in 2026, the partners will either operate the solar facility or sell it, splitting any profits equally, according to OCI.

TO BENEFIT FROM IRA INCENTIVES

OCI and Arava stand to benefit from the Inflation Reduction Act (IRA), which provides tax incentives for renewable energy projects in the country.

The companies expect to receive an investment tax credit of 30%, plus an additional 10% energy community bonus for clean energy projects, resulting in potential reimbursements of up to 40% of their total investment.

Arava Power has developed and operated multiple solar and energy storage projects in the US.

Through the partnership, OCI Energy expects to gain insights into Arava’s expertise while contributing its know-how in regulatory compliance, financial structuring and power plant operations.

“OCI Energy is the leading solar development firm in Texas, with a 15% market share in the state’s solar power sector,” said OCI Holdings Chairman and CEO Lee Woo-hyun. “This year, we plan to expand beyond Texas into other regions, further diversifying our revenue streams.”

Since entering the US solar market in 2011, OCI Energy has completed over 10 solar and energy storage system (ESS) projects. The company aims to leverage its experience and the latest partnership to strengthen its position in the renewable energy industry amid rising demand for clean power solutions.

Write to Sang-Hoon Sung at uphoon@hankyung.com

In-Soo Nam edited this article.