Middle Eastern oil giant Saudi Arabia is set to develop a mammoth 2.6 gigawatt (GW) solar park in the Makkah Region, home to the two holiest mosques in Islam, the Al-Haram Mosque in Mecca and the Prophet’s Mosque in Medina.
His Royal Highness Prince Khalid Al-Faisal — who oversees the development of the region as the Prince of the Makkah Region and Advisor to the Custodian of the Two Holy Mosques — and His Excellency the Minister of Energy, Industry and Mineral Resources, Khalid bin Abdul Aziz Al-Faleh, signed a Memorandum of Understanding (MoU) on Saturday on the sidelines of the second session of the Makkah Economic Forum held over the 23 to 26 of March. The planned 2.6 GW Al Faisaliah Solar Project will be a joint project between the Ministry of Energy and the Makkah Region Development Authority.
Only 600 megawatts (MW) will be tendered through the Renewable Energy Projects Development Office (REPDO) — set for later this year — with the remaining 2 GW set to be developed by the Public Investment Fund and selected partners.
This is in line with news reported in January that REPDO was set to tender 2,225 MW of solar projects this year, including the incorrectly-named Alfaisalia project — which is obviously the Al Faisaliah Solar Project. Further, and from the same report, REPDO upgraded its long-term solar target to 20 GW by 2023 and 40 GW by 2030, highlighting the country’s desire to diversify its energy mix. As the Ministry of Energy explained in its press release on Sunday, the newly-signed “MoU is in line with the vision of the Kingdom of Saudi Arabia 2030, and within the efforts of the Ministry of Energy to diversify the energy mix to reach a sustainable mix that benefits from renewable energy sources, in addition to optimizing the use of hydrocarbon and mineral resources to achieve sustainable development of the national economy.”
Saudi Arabia also has a larger renewable energy target of 27.3 GW by 2023 and 58.7 GW by 2030 — bolstered by the January announcement of the country’s first wind farm, the 400 MW Dumat Al Jandal wind farm set to be built 560 miles north of Riyadh, in the Al Jouf region of north-western Saudi Arabia.
The country’s renewable energy ambitions are being supported by its National Renewable Energy Program (NREP) which, according to Sohaib Malik, Market Analyst with Wood Mackenzie, originally targeted “9.5 GW of renewable energy capacity by 2023.” Specifically, “In Phase 1, the county will award 3.5 GW and 1.2 GW of capacity for solar PV and wind, respectively.”
“Developers are bidding low price levels due to consistently reducing costs of both wind and PV technologies,” Malik added. “Further, Saudi Arabia offers a stable and mature financial market which helps developers mobilise low-cost capital. Likewise, these are projects for 300 to 400MW of capacity that offer significant cost benefit in the form of economies of scale.”
The new Al Faisaliah Solar Project in Makkah will supply electricity to the Western region of Saudi Arabia and Al Faisaliah city at peak times, increasing the security and flexibility of electric power.