The Asian Infrastructure Investment Bank (AIIB) is investing $60m (€55m) in Oman’s Ibri II Solar project.

AIIB said it has approved the loan to help finance a 500MW greenfield solar photovoltaic power plant in Ibri being developed by a company established by ACWA Power, Gulf Investment Corporation and Alternative Energy Projects.

The $400m Ibri II Solar project is Oman’s first utility-scale renewable energy project to be connected to the grid.

The China-backed bank said the project will help increase Oman’s renewable power generation capacity and reduce the country’s dependence on gas and other fossil fuels for electricity generation.

This is AIIB’s first nonsovereign-backed financing in the country’s renewable energy sector.

AIIB vice president DJ Pandian, said: “AIIB’s investment will increase the availability of Oman’s renewable power generation capacity and contribute to filling the anticipated gap in peak demand.

“The project will also help the country move toward a more balanced and environmentally sustainable energy mix to ensure long-term energy sustainability.”