Saudi-based energy and water desalination giant Acwa Power has signed a series of landmark agreements with Malaysian stakeholders to develop up to 12.5 gigawatts of sustainable energy capacity by 2040.

The deals, announced during the recent Asean-GCC summit in Kuala Lumpur, mark one of the largest potential foreign investments in Malaysia’s renewable energy sector, with an estimated value of up to US$10 billion.

Under a memorandum of understanding with the Malaysian Investment Development Authority ( Mida ), Acwa Power will explore large-scale developments in renewables, green hydrogen, and advanced water desalination.

The initiative directly supports Malaysia’s National Energy Transition Roadmap, which targets 70% renewable energy capacity by 2050, and aligns with Saudi Arabia’s Vision 2030 goals for global climate leadership.

Strategic partnership agreements were also signed with Malaysia’s national utility Tenaga Nasional Berhad ( TNB ), Terengganu Inc, and UEM Lestra. These partnerships will explore joint development of floating solar PV, combined-cycle gas turbine projects, and water desalination infrastructure, with feasibility studies already underway.

“These strategic agreements represent a significant milestone in Acwa Power's expansion in Southeast Asia and reflect our commitment to supporting Malaysia and the broader Asean region’s energy transition,” says Acwa Power chief executive officer Marco Arcelli.

“By combining our global expertise in renewables, water desalination, and green hydrogen with the local knowledge of our Malaysian partners, we are not only accelerating the deployment of clean energy solutions but also fostering technology transfer, job creation, and long-term economic growth and social well-being of the local community. These partnerships are a testament to our shared vision for a sustainable future.”

While bolstering regional cooperation between Asean and Gulf states in climate-focused infrastructure development, Acwa Power’s Malaysia initiative also positions the company as a key enabler of Asia’s clean energy transition.