1,177 MWp solar PV project by Sterling and Wilson Solar, located in Abu Dhabi.

Oil-dependent markets in the Middle East have a strong incentive to diversify their economies and have all set ambitious renewable energy goals. If they are to be realized, the region will have to deploy more than 50 GW of solar PV by 2030.

The development of PV has also been driven by public sector support. Even though the industry experienced a slowdown during the global Covid-19 pandemic, solar energy is once again at the heart of economic recovery efforts. Oil prices are now back at a higher level and supply chain issues are not as severe.

In this article, we profile the large PV mounting markets in the Middle East that are expected to lead the region in solar energy deployment.

United Arab Emirates Solar Energy Mounting Solutions

The UAE has been at the forefront of the clean energy transition in the Gulf region in terms of PV deployment and ambitious renewable targets. The Emirates aims to generate 50% of its electricity from carbon-free sources, driven mainly by solar PV, by 2050. Abu Dhabi, for instance, plans to install 5.6 GW of PV capacity by 2026 and Dubai aims to source 75% of its electricity generation from renewable by 2050.

Both have been the frontrunner of the Middle Eastern PV industry. Abu Dhabi hosts the world’s largest operational PV plant, the 1.2 GW Noor Sweihan project, which has been feeding electricity into the grid since 2019. The plant is backed by Marubeni and JinkoSolar and has a 25-year power purchase agreement (PPA) with a tariff of 2.42 USDct/kWh.

Another giant project, the 2 GW Al Dhafra plant, is expected to be operational by Q1 2022. This private public partnership project will be 60% owned by the Abu Dhabi National Energy Company (TAQA) and 40% owned by a consortium comprised of EDF, Masdar, and Jinko Solar. A 30-year PPA will be in place with a tariff of 1.35 USDct/kWh.

Utility-scale PV installations in Dubai are clustered in the giant Mohammed bin Rashid Al Maktoum Solar Park (MBR solar park), the development of which is planned over several phases. Once fully complete, this mega solar park will reach 5 GW in capacity. The Dubai Electricity and Water Authority (DEWA) holds the majority equity share in the project. Each phase sees a growing installed capacity with declining tariffs.

The fourth phase will include a large share of concentrated solar power (CSP). There is also interest from the northern Emirates to become involved with Etihad Water and Electricity having set targets of executing 100 MW of solar PV projects. No further details have yet been revealed, however.

As the level of solar penetration increases in the grid, we expect regulations to expand allowing for small-scale, behind-the-meter storage in association with time-of-day tariffs. Utility-scale tenders mandating a specific size of storage to allow for power plant ramp up and ramp down in coherence with other generation assets are expected. Such regulations would allow for better use of the distributed energy sources that exist on the grid and enable the economical and reliable operation of the electrical network with mixed generation assets working side by side.

Saudi Arabia Solar Module Bracket Racking

In 2019, Saudi Arabia dramatically increased its 2023 renewable energy targets from 9.5 GW to 27.3 GW under its National Renewable Energy Program (NREP). This program divides the 27.3 GW goal into 20 GW of solar PV and 7.3 GW of wind. In addition, the Vision 2030 program sets another ambitious target of 60 GW of renewable electricity capacity by 2030 that will include 40 GW of PV and 2.7 GW of CSP capacity, and the sourcing of 50% of electricity generation from renewable technologies.

The bulk of the target capacity is expected to be reached via large-scale tenders and other mega projects such as NEOM, a sustainable zone in northwest Saudi Arabia that is planned as the hub for the Saudi green economy and a landmark for sustainability.

Last year, however, was a slow one for the Kingdom in terms of PV deployment where almost no capacity increases materialized. Following this stall in the industry, the crown prince announced the signing of PPAs for seven PV projects – six of which were from the delayed second round of REPDO (Renewable Energy Development Office) tenders. REPDO has most recently announced the shortlisted bidders for the projects but has not reported any further developments so far. With the addition of the ACWA Power-led 1.5 GW Sudair project, these seven projects will contribute almost 3 GW of solar PV installations.

NREP maps out two main paths for increasing the installed PV capacity: tenders and direct agreements. 30% of the target capacity is expected to be awarded via tenders by REPDO. The Kingdom’s first large-scale PV project (the 300 MW Sakaka) for instance, was awarded a 25-year PPA from the first round of the tenders in 2018.

Most recently, REPDO received bids for the third round for four projects with a total capacity of 1.2 GW. NREP also includes direct bilateral agreements with developers and the Public Investment Fund (PIF) to develop and build large PV projects. The 1.5 GW Sudair project is an example of such projects and many more are expected in the future. Direct agreement projects will make up 70% of the targeted capacity.

Although PV development in the Kingdom has been entirely driven by utility-scale projects, rooftop PV also has large potential. Currently, 50% of the electricity consumption in Saudi Arabia is from the residential sector, with 70% of this used for cooling requirements. This creates an excellent match between electricity consumption and Ground PV Racking.

In 2020, Saudi Arabia enacted a law allowing the installation of rooftop systems of up to 2 MW in size. This ushers in a potential gigawattscale market with the right legislative environment.