Renewable energy companies offered a record-breaking bid for the third phase of the Mohammed bin Rashid Al Maktoum Solar Park. At rates of 2.99 U.S. cents per kilowatt-hour, the bid means that solar power in Dubai would be cheaper than coal when compared to rates of a recently-commissioned coal plant.

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The Dubai Electriciy and Water Authority (DEWA) behind the solar park collected five bids for phase 3. The part of the project in question is expected to generate 800 megawatts.

Related: Solar and wind power are now cheaper than coal or natural gas in some markets

Dubai set a new solar price record in January 2015 with bidders offering rates of 5.85 cents for another part of the park, but the city was upstaged by first Peru and then Mexico, who set the most recent record last month. The new price of 2.99 cents is 15 percent lower than the Mexico record.

Last October Dubai commissioned a coal power plant set begin operating in 2020. It is expected to generate electricity at prices of 4.501 cents per kilowatt-hour, making solar power at the 2.99 cents bid about one third cheaper than coal.

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DEWA has not announced who the bidders are, although some are reporting it was a consortium of three companies: Masdar Abu Dhabi Future Energy Company, Fotowatio Renewable Ventures BV from Spain, and Abdul Latif Jameel from Saudi Arabia.

A consortium spokesperson clarified this is an active bid, which means the companies haven’t necessarily won the contract, but it’s a thrilling step for those who look toward a future where renewable energy is the cheapest power source available. By 2030, the entire solar park facility should produce up to five gigawatts of clean energy. DEWA’s ultimate goal is to provide 25 percent of “total power output” in Dubai from renewable sources by that year, followed by 75 percent in 2050.

Via Bloomberg

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