Sector Overview
Jordan has rapidly positioned itself as a regional leader in renewable energy. Solar and wind projects currently supply nearly one-third of the Kingdom’s electricity, with a national target of 50% by 2030.
The country’s natural advantages — more than 300 days of sunshine per year and reliable wind corridors with average speeds of 7–8.5 m/s — make Jordan an ideal hub for renewable investment. Combined with strong government support and evolving legislation, the sector offers growing opportunities for both domestic and international investors.
Landmark Projects
- Baynouna Solar Power Plant (200 MW): A flagship project and one of the largest solar installations in Jordan, showcasing international investor engagement.
- Tafila Wind Farm (117 MW): Jordan’s first major wind farm, operational since 2015, demonstrating long-term viability in wind energy.
- Attarat Oil Shale Project: While not renewable, it highlights Jordan’s broader energy diversification strategy.
- Aqaba–Amman Water Desalination and Conveyance Project (AAWDC): A strategic infrastructure project linking water security with renewable-powered desalination and pumping.
These initiatives reflect strong investor traction and Jordan’s ongoing commitment to energy transition.
Legal and Regulatory Framework
1. Power Purchase Agreements (PPAs) : Licensed renewable projects benefit from NEPCO’s obligation to purchase electricity. Interconnection costs are covered, and standardized solar and wind PPA templates reduce negotiation time and provide greater certainty.
2. Draft General Electricity Law (2024) : Expected to replace existing legislation and introduce a unified licensing framework. Expands private sector participation in generation, transmission, distribution, and storage. Establishes long-term strategies for hydrogen production and export.
3. Regulatory Risks and Grid Limitations : Grid capacity constraints continue to challenge large-scale integration of renewables.Tariff revisions in past projects highlight the need for protective clauses in contracts. Temporary suspensions of large-scale licensing (>1 MW) demonstrate the importance of timing and regulatory awareness.
4. Incentives and Special Zones : Projects in ASEZA, Free Zones, and designated investment areas may benefit from tax relief, customs exemptions, and streamlined licensing. Strategic structuring is necessary to maximize these incentives.
5. Hydrogen and Storage Opportunities : The new law is expected to allow licensing of battery storage facilities and private self-consumption systems. Hydrogen is emerging as a strategic national priority, with goals to establish Jordan as a hub for regional hydrogen supply and export by 2050.
Legal Considerations for Investors
- Assess grid capacity, curtailment risk, and change-of-law exposure before committing to projects.
- Ensure PPAs include termination, force majeure, stabilization, and tariff adjustment provisions.
- Consider local partnerships to meet content requirements and strengthen compliance.
- For hydrogen and storage, adopt flexible contractual frameworks to accommodate evolving regulation.
At Jaradat Lawyers, we support international and domestic clients in navigating Jordan’s rapidly evolving energy and infrastructure sector. Our services include:
- Regulatory Advisory – guiding clients through licensing, permitting, and compliance with the Ministry of Energy and regulatory bodies.
- Contract Structuring – advising on Power Purchase Agreements (PPAs), joint ventures, EPC contracts, and project finance documentation.
- Investment Structuring – assisting foreign investors in optimizing project vehicles, tax incentives, and free zone advantages.
- Risk Mitigation – drafting robust contractual protections addressing tariff revisions, change-of-law risks, and termination safeguards.
- Future-Focused Opportunities – advising on hydrogen, energy storage, and emerging technologies within Jordan’s new electricity law framework.
Through our deep knowledge of Jordanian law and regional practice, combined with international experience, we provide clients with practical, business-oriented solutions that align with both legal requirements and commercial objectives.