The webinar was held by EQ Magazine Pro on March 23, 2022, powered by LONGi Solar and moderated by Nabih Cherradi, Chief Technology Officer, Desert Technologies. This webinar was regarding Saudi Arabia PV Invest Tech.
L K Verma, Managing Director, Power N Sun put his views about the Saudi markets, products, projects and supply chain. He said, “I’ve been very vocal in the last couple of years about making the materials available to the site in the right way in the right format at the right time. Any solar project is defined in time cost and quality dimensions, we leave the quality dimensions to the manufacturers because they are spending a lot of money on research and development. The next thing is the cost part because we are competing against the actual power from the grid coming up in many places so the cost is equally important.
So, how the cost can also be reduced by addressing the whole sum of a solar project. In solar business, the key aspect in this entire project is approximately 70% to 75% of time cost and energy is spent in making the materials available to the site, installations another 15% to 20%, commissioning 5% and that’s how the entire solar project is built. This is the area where we focus a lot and work on increasing the speed of solarisation in the region.”
Talking about the working domain of Power N Sun, he said, “We are a wholesale distribution company. We move around 150 MW to 200 MW per year from our warehouse. Longi is one of our largest partners. We have a mechanism of real-time capturing of demand in the marketplace, especially from retail distribution for the residential sector and C&I sector. We draw projections, create forecasts and place orders in advance to the manufacturing companies. Due to the size, we observe all the volatility of the markets and the risks which are available in the supply chain. That’s how any product with any component to 15 to 20 megawatts of size scale can be made available to the site in a maximum of four to six weeks. We got a presence in more than 35 countries and around 7 to 8 of our subsidiaries and branches in 70 countries. We are a one-stop solar solution supply company. We take PV modules, inverters, cables, connectors, and structure everything together from a loose component to the integrated supplier which makes a solar sense to the supplies. We are probably the first company in the region who started up with online sales.”
Yahya AlKhoshi, CEO (Sudair PV IPP Project Company), ACWA Power spoke about solar project execution and experiences such as Sakaka, a PV IPP project, was the first project in the renewable energy program of Saudi Arabia. He said, “ACWA is an international developer for power and water dissemination and also green hydrogen projects. And now we have a portfolio of 65 assets that produce more than 40 GW of power and more than 6,000,000 cubic metres per day of this disseminated water. We operate in 12 countries around the world. The renewable energy share of the ACWA portfolio is above 35%, from the overall portfolio that we have. ACWA had the honour to be the winner of the bidding of the first renewable energy programme of Saudi Arabia, which was Sakaka PV IPP in 2018.
Sakaka project is a project with a maximum dispatch capacity of 300 MW, DC capacity is about 400 MW. We commenced construction in Sakaka in 2018 and we achieved the successful commercial operation of the project in December 2019. As the first project, we had many challenges, however with all these challenges with the collective commitment and support from all the stakeholders also their suppliers of the project became successful. The project also achieved the local content target that we had as a part of the contract. At the beginning of the project, there were doubts about it but after we completed the project and did the audit we passed the local content requirement. The project has been in operation since the end of 2019, without any major issues building on that success.”
Mohammad Abuhilal, CEO, Sun Synergy Group made a small brief and addressed the process of solarisation in Saudi Arabia. He said, “There is still no grid system that we can tap in to get the generated power to be connected to the grid. And this is one of the real challenges still in Saudi Arabia. The other challenge is that most of the systems now that are solved primarily are off-grid systems. We get a lot of customers with farms or sites where they don’t have any access to electricity except for generators or just basic type of solar systems.
There are a lot of issues regarding logistics and procurement so there has to be a more structured market for the solar business. Our company focuses on the development of projects and we have been in discussions with major corporations in factories that they are in definite need of solar energy because the cost of power for them is quite high and definitely it will affect their bottom line. If they can do solar on the rooftops or in the land available in their premises to reduce the cost of power.
Talking about the challenges in the solar sector in Saudi Arabia, he said, “There are few challenges that we need to address and how to overcome them in the next few years. We are involved in solar energy to generate green hydrogen. This is a very new technology that will be addressed soon in Saudi Arabia which would give the potential of covering for the balance of the 24 hours day, as of now PV solar can cover maybe 5-6 hours maximum per day. This will cover the balance of the day and also give stability to the grid itself within the 24 hours or the peak hour utilisation. Grid stability issues also have to be addressed in combination with solar energy.”
Sherief Attia, Energy entrepreneur and CEO, ORBITS ECOTECH discussed the situation of the renewable energy market and the challenges that are faced by the market post covid pandemic. He said, “There are five major challenges in the market. The first one is the financing. Local banks and private equity funds often only provide interest short payback loans and these are typically not tailored to the local market, specifically not for the renewable energy industry. Renewable energy projects require large investments that are often not possible for multiple years. To date, the main source of funding for renewable projects have been commercial banks. The second challenge that we see is the underdeveloped infrastructure and regulatory framework. There is currently no regulatory framework that is exclusively tailored to the generation, transmission and distribution of renewable energy. The generation, transmission and distribution of electricity regardless of whether it drives from renewable or conventional energy, is considered an electricity activity and is therefore regulated by the electricity law. The electricity law and its implementing regulation which apply to conventional power projects also apply to renewable energy projects in further considerations are needed to adapt the large amount of solar energy generation which may lead to issues relating and challenging regarding management of the grid link.
The third challenge that we see is the lack of promotion of renewable energy in KSA and lack of support. Today, most of the focus is on utility scale projects and we should also have some focus on the high consumption consumers and the corporate sector. The fourth challenge is the resilience of renewable projects during Covid and Russian- Ukraine war. Looking at the project pipeline through 2025, almost 1/3 of wind and solar projects are already contracted or financed. Such projects have limited risk of cancellation and are expected to become operational as planned. The fifth challenge is the unskilled labour market. The challen the local labour faces today in Saudi Arabia is not to be trained or experienced in renewable energy and projects because training costs time and money which makes projects more expensive. This raised the need for local governmental programmes and incentives to develop the labour market.”
Khalid Al-Mutairi, Renewables Sector, Ministry of Energy said that Saudi Arabia is aiming to localise the opportunities for the manufacturing, machining and testing for the solar technologies. This has been set as a target for 2030 and this will enhance and provide more content and value to the local investments and also create job opportunities for the locals.
Wansi Zheng, Country Manager KSA, LONGi Solar shared her views on how LONGi sees its developments by selling models to developers. She said, “From 2019, we have a plan to start our manufacturing in Saudi Arabia. We have a complete business proposal on the localization of manufacturing in Saudi Arabia. We want to support Saudi Arabia in terms of the localization and local content. All the manufacturing of the solar panels is basically in China and we have to grow this on a global scale.”
