Renewable Energy Capacity in Saudi Arabia

Renewable Energy Capacity in Saudi Arabia: From Ambition to Deployment

Saudi Arabia’s renewable energy programme has evolved from a nascent aspiration to one of the world’s most significant clean energy deployment efforts under Vision 2030. The Kingdom targets 50 per cent of electricity generation from renewable sources by 2030, requiring the installation of approximately 130 gigawatts of renewable capacity, predominantly solar photovoltaic and wind. As of the latest reporting, total awarded renewable capacity exceeds 20 gigawatts, with operational projects generating at-scale clean electricity and a substantial pipeline of projects in development and construction.

Solar Energy

Saudi Arabia possesses exceptional solar resources, with global horizontal irradiance averaging 5.5 to 6.5 kilowatt-hours per square metre per day across much of the Kingdom, among the highest levels globally. This natural advantage, combined with vast available land area and declining solar technology costs, positions Saudi Arabia as an ideal location for utility-scale solar deployment.

The Sudair Solar Plant, developed by ACWA Power and PIF-subsidiary Badeel, has a capacity of 1.5 gigawatts, making it one of the world’s largest single-site solar installations. The Shuaibah Solar Plant delivers 2.6 gigawatts of capacity. Additional large-scale solar projects at Al Rass, Saad, Ar Rass, and multiple other sites are at various stages of development and construction.

Solar tariffs achieved in Saudi competitive auctions have been among the lowest globally, with winning bids below USD 0.02 per kilowatt-hour in multiple rounds. These record-low tariffs reflect the combination of excellent solar resources, competitive auction design, and investor confidence in the Kingdom’s regulatory and offtake framework.

Wind Energy

Wind energy development in Saudi Arabia has progressed alongside solar, though at a more measured pace. The Dumat Al Jandal wind farm, located in the Al Jouf region, was the Kingdom’s first utility-scale wind project, with a capacity of 400 megawatts. Additional wind projects are planned for the northwestern and coastal regions where wind resources are most favourable.

The National Renewable Energy Program’s wind allocation targets complement the solar-dominant strategy by providing generation diversity and supporting grid stability. Wind energy’s generation profile, which often peaks during evening and night-time hours, offers partial complementarity to solar output.

Institutional Framework

The Renewable Energy Project Development Office (REPDO), operating under the Ministry of Energy, manages the competitive procurement of renewable energy projects. REPDO conducts transparent, multi-round auctions that attract international developers and financiers. The procurement framework includes long-term power purchase agreements with the Saudi Power Procurement Company, providing revenue certainty for project investors.

The Saudi Power Procurement Company (SPPC) serves as the single buyer of renewable electricity, integrating clean energy into the national grid managed by the Saudi Electricity Company. Grid integration planning, including transmission expansion and energy storage deployment, is coordinated through the Electricity and Cogeneration Regulatory Authority.

ACWA Power and the Developer Ecosystem

ACWA Power, a Riyadh-headquartered developer with PIF as its largest shareholder, is the Kingdom’s leading renewable energy developer and one of the largest globally. ACWA Power’s Saudi portfolio encompasses multiple gigawatts of operational and under-construction solar and wind capacity. International developers including EDF Renewables, Masdar, and various Asian and European energy companies participate in Saudi renewable auctions, ensuring competitive market dynamics.

Energy Storage and Grid Integration

The deployment of battery energy storage systems (BESS) is emerging as a critical enabler of high renewable penetration. Saudi Arabia’s national energy strategy includes provisions for utility-scale storage to manage intermittency, provide grid services, and shift solar generation to evening peak demand periods. Hydrogen production from renewable electricity, discussed in the context of the NEOM Green Hydrogen Project, represents an additional pathway for storing and exporting renewable energy.

Outlook

Saudi Arabia’s renewable energy trajectory is one of the most ambitious globally, with the 2030 targets requiring a dramatic acceleration in project deployment. The combination of world-class solar resources, competitive procurement frameworks, sovereign investment capacity, and strategic motivation to free hydrocarbons for export creates a compelling value proposition. For renewable energy developers, equipment manufacturers, and clean energy investors, the Saudi market represents a generational opportunity.