Hello Amin, could you tell us briefly about the solar ecosystem in the Kingdom of Saudi Arabia?

Solar energy was introduced in Saudi Arabia through the National Renewable Energy Program (NREP) which is a strategic initiative under Vision 2030 and the King Salman Renewable Energy Initiative. NREP has an ambitious plan targeting 50% renewable energy of the energy mix, while the other 50% will be supplied by natural gas. The renewable energy projects pipeline is split in two parts. Even though the whole program is tendered by the Ministry of Energy, 30% of the program is tendered publicly and used for price discovery, while the remaining 70% are under responsibility of the Public Investment Fund (PIF) and tendered with first right of refusal to PIF strategic developers. The 70% is intended to use for giga scale localization.

 

NREP since its inception in 2016 promoted local content (LC) policies. In 2018 however, the Local Content and Government Procurement Authority (LCGPA) was established and since then it has been acting as (LC) advisor to the NREP.

 

Major stakeholders:

• Ministry of Energy

  • Has 3 mandates of NREP

    • The execution of the projects (land pre-development, engineering, and tendering)

    • Local content policy development

    • Private sector stimulation

• Ministry of Industry and Natural Resources:

  • Works jointly with the ministry of energy to ensure the localization of the sector, with more focus on the supply chain, and industrial sector development.

• Local Content and Government Procurement Authority

  • Acts as an advisor to the Ministry of Energy and provide best practices for setting local content targets and local content auditing practices

• King Abdullah City of Atomic and Renewable Energy:

  • Has another 3 mandates of NREP,

    • Technology localization

    • The National Atlas

    • The national data center for renewable energy

• Ministry of Investment: Acts the promoter of the program through the Saudi Invest gateway.

• Public Investment Fund

  • Invests in the 70% of NREP program

  • Facilitate giga scale localization.

• Saudi Industrial Development Fund

  • Support the localization and manufacturing through its renewable energy program called Mutjadedah with relaxed financing terms.

• The Saudi Power Procurement Company (the Principal Buyer): acts as the off-taker of the renewable electricity fed into the grid.

• Water and Electricity Regulatory Authority (WERA):

  • Sets the regulatory frameworks related to renewable energy, the grid, and small-scale solar energy systems.

• Saudi Electricity Company

• The National Grid

 

​Major manufacturers:

Saudi Arabia currently has 5 panel manufacturers with a production capacity of 700MW, with planned expansion to a total of 2.3GW in 2022.

 

Solar PV Supply Chain:
There are several new investment proposals that are currently under study with a target capacity of 1-2GW by 2023-2024.

 

In addition, mounting structures and trackers are products that have already been localized and they are exceeding the local demand. Al Yamamah, Al Babtain and PVH are producing over 4GW, 70% of this volume has been exported to overseas market in MENA region, Europe and the US.

 

There are several proposals that are considering inverter, glass, and aluminum manufacturing in KSA. The stakeholders are open to discuss these investment opportunities with local and international investors.

 

What is the installed solar capacity currently in KSA?

Currently there is one project that is operational, Sakaka (300MW) of round 1.

Round 2 projects were tendered in 2019 and awarded in 2021.

Round 3 projects were tendered in 2020 but have not been awarded. There are some delays due to the pandemic.

There is an upcoming CSP project that is intended to be complemented with solar PV.

 

Can you share with us some of the projects you are currently working on?

The potential of solar PV energy is explored in different sectors. Green hydrogen is seen to provide a tremendous
demand, and that could be seen from NEOM Helios Project for Green Hydrogen.
Some other potential demand might arise from the Saudi Airports, Industrial Zones, as well as major industrial
conglomerates like Saudi Aramco and SABIC.

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