June 27, 2024

Saudi Arabia Signs Major Solar Project Agreements

To stimulate its renewables industry, Saudi Arabia has recently announced a series of historic power purchase agreements (PPAs) for three massive solar projects, which is a key component of Vision 2030, a masterplan for the kingdom to reduce its dependence on fossil fuels and become a post-petroleum paradise.

Major Solar Projects Unveiled

Three solar PV plants, through consortia including ACWA Power, the Water and Electricity Holding Company (Badeel), and Saudi Aramco Power Company (SAPCO), are also scheduled to be developed in partnership with the Saudi Power Procurement Company (SPPC).

Aiming to serve the holy cities: Haden and Muwayh in the Makkah region each of 2,000MW, and the Al Khushaybi plant in the Qassim region of 1,500MW, which, in total will increase the ability of the kingdom to use renewable energy folds.

These solar schemes form part of an integrated development programme comprising a multitude of schemes with a combined capacity of 13,600MW at an investment of more than $9 billion by the PIF and its partners.

The new renewable solar PV schemes, which are expected to inject 5,500MW of clean energy into the national grid by the first half of 2027, have a combined value of SAR12.3 billion ($3.3 billion) and are aimed at achieving Saudi Arabia’s national net-zero emissions by 2060. The financial closure of the projects is expected by the end of 2024.

2030 Vision

Saudi Arabia is moving fast in its energy transition, and we are pleased to continue to play a role as a key partner to Badeel and Aramco,’ said Raad Al-Saady, vice chairman and MD of ACWA Power. With these solar projects, the power company’s total global capacity in renewables reaches 35,000 MW, a testament to its leadership in delivering competitive, low-cost renewable energy.

Sultan AlNabulsi, Badeel’s acting CEO, said that the project reflected ‘PIF’s commitment to Vision 2030’, a Saudi plan to diversify its economy beyond oil.

Adding: ‘Badeel is proud to reach this milestone for the new solar PV projects in the Kingdom; this project comes with great passion and aim to contribute towards PIF’s effort to achieve local content in producing 70 per cent of Saudi Arabia’s renewable energy by 2030

Advanced PV Technology and Environmental Goals

The projects will be powered by state-of-the-art PV technology that promises to maximise output, minimize disruptions and reduce maintenance downtime, handling Saudi Arabia’s surging energy needs. By 2030, renewables and natural gas each will power about half of the kingdom’s domestic electricity production.

Meanwhile, Aramco plans to invest in up to 12,000 megawatts of solar and wind energy by 2030 and is aiming to achieve net-zero Scope 1 and Scope 2 (direct energy consumption and indirect consumption) greenhouse gas emissions by 2050. ‘We look forward to continuing our strategic partnership with ACWA Power and Badeel to strengthen the delivery of lower emitting energy and to meet growing power demand,’ said Waleed Al Saif, senior vice president of New Energies at Aramco.

With this announcement, ACWA Power’s total solar projects in Saudi Arabia rise to 17,800MW, underscoring the kingdom’s vision to be a global leader in renewables and, by so doing, drive down its carbon footprint.

With these projects, the kingdom is already stemming towards the implementation of its Vision 2030 goals. It comes as no surprise that Saudi Arabia is getting involved in solar energy programmes; a matter that sheds a good light on the kingdom’s contribution to the global transition towards a sustainable energy era.

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