Saudi Arabia solar target raised after seven projects added including record low cost
HIGHLIGHTS
-
Record low electricity cost of 1.04 cents/kWh
-
Sakaka is Saudi Arabia’s first renewables project
-
Other project costs at 3.40-4.90 cents/kWh
Dubai : Saudi Arabia is closer to developing 3.3 GW of solar capacity up from only 300 MW currently operational as plans were announced earlier this month for seven projects, according to a new analysis from S&P Global Platts Analytics.
Register Now “Things seem to be moving,” Bruno Brunetti, head of global power planning at Platts Analytics, said by email on April 26.
“Our forecast is for 7.7 GW built by 2026, which is in line with our prior forecasts.”
Earlier this month, Saudi energy minister Prince Abdulaziz bin Salman inaugurated the Sakaka IPP PV project, the first renewables project in the kingdom, with an output capacity of 300 MW as power purchase agreements were signed for seven solar projects.
They included the 600 MW Shuaibah project with a world record low electricity price from solar of 1.04 cents/kWh. A smaller project, the 20 MW Rafha deal, had bids of 3.40-4.90 cents/kWh, showing “not all the projects are the lowest globally,” Brunetti said.
The total capacity of all the projects, in addition to the two projects of Sakaka and Doumat Al jandal, is 3.67 GW. They will power more than 600,000 households and reduce greenhouse gas emissions by more than 7 million mt, according to the energy ministry.
All projects tendered are backed by 25-year power purchase agreements with the Saudi Power Procurement Co. as offtaker.
The Sakaka project has been developed by Acwa Power, co-owned by the government investment fund.
Renewables are intended to reduce the use of liquid fuel in electricity production while providing more crude for export. Saudi Arabia aims to have gas and renewables at 50% of energy use by 2030, by removing around 1 million boe/d of liquid gas used as fuel in electricity production and water salination.
Source: spglobal
