meed-logo

line1 line2 line3
SIGN IN / REGISTER

Riyadh’s 130GW renewable target needs justification

25 June 2024

Commentary
Jennifer Aguinaldo
Energy & technology editor

Saudi Arabia's Energy Minister, Prince Abdulaziz Bin Salman Bin Abdulaziz Al-Saud, recently confirmed plans to tender 20GW of renewable energy projects annually starting this year, in line with reaching 100GW-130GW of installed capacity by 2030, "depending on electricity demand growth".

It is the highest-level confirmation yet that the kingdom has revised its target of having 58.7GW of renewable energy installed capacity by the end of the decade.

Notably, the upward revision of the renewable energy installed capacity target does not change the original objective for renewable sources to account for 50% of the kingdom's overall electricity production installed capacity by 2030.

This implies a parallel growth in gas-fired capacity due to the need to implement the kingdom's liquid fuel displacement programme and build baseload capacity to deal with the intermittency of renewable sources such as solar and wind, notwithstanding plans to build multi-gigawatts of battery energy storage system capacity.

However, not everyone is convinced that Saudi Arabia needs this much capacity so soon, despite the all-important qualifier "depending on electricity demand growth".

"Where will the power be used, can the grid take it, and where is the population and industry data to justify the demand growth?" asks an executive with an infrastructure investor.

According to the International Renewable Energy Agency (Irena), Saudi Arabia's electricity generation capacity stood at about 84GW in 2022, with renewable energy capacity accounting for 1% of the total.

The same report specifies that oil sources accounted for 49% of the kingdom's total energy supply in 2020.  

According to BP's annual statistical review, Saudi Arabia's electricity generation in 2021 amounted to roughly 357 terawatt-hours, which is estimated to require about 44GW of installed capacity. This is approximately one-half of the kingdom's installed capacity if the Irena report is anything to go by.

Crucially, UK-headquartered data services provider GlobalData, which reports a higher cumulative installed capacity of 94GW for Saudi Arabia, expects the kingdom's overall capacity to increase by a compound annual growth rate (CAGR) of more than 2% between 2023 and 2035.

An assumed 2.4% CAGR would take Saudi Arabia's installed capacity to about 96GW by 2030, using the Irena installed capacity of 84GW as a baseline. Based on this, plus a further assumption that all oil-fired and aging gas-fired capacity will be retired by 2030, the kingdom could need to procure at least 50GW-60GW by the end of the decade.

However, this figure does not factor in the amount of baseload required to balance its electricity system as more intermittent renewable energy enters the kingdom's grid.

Massive survey

It is significant that Prince Abdulaziz issued the above statement on 24 June, when the ministry announced the start of a project to survey 850,000 square kilometres of land in Saudi Arabia – equivalent to the land areas of the UK and France combined – to determine the most suitable locations for solar and wind projects.

Such a statement leaves open to speculation whether the aspirational target of 100GW-130GW of renewable energy capacity by 2030 includes the capacity planned by gigaproject developer Neom, which aims to be fully powered by renewable energy by 2030, and which has already carried out pre-development work for over 35GW of solar capacity. 

The question now seems to be whether the kingdom's ongoing gigaprojects, its industrial expansion plans and green hydrogen projects, and its clean energy export ambitions will justify building twice as much capacity as forecast based on historical data and its current needs.

"Justifications are important, otherwise such lofty plans only expose investors to increased risk," the source told MEED. 

 

https://image.digitalinsightresearch.in/uploads/NewsArticle/11992190/main3432.jpg
Jennifer Aguinaldo

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • UAE GDP projection corrects on conflict

    24 April 2026

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16554417/main.gif
    MEED Editorial
  • April 2026: Data drives regional projects

    24 April 2026

    Click here to download the PDF

    Includes: Commodity tracker | Top 10 global contractors | Brent spot price | Construction output

    MEED’s May 2026 report on the UAE includes:

    > COMMENT: Conflict tests UAE diversification
    > GVT &: ECONOMY: UAE economy absorbs multi-sector shock
    > BANKING: UAE banks ready to weather the storm
    > ATTACKS: UAE counts energy infrastructure costs
    > UPSTREAM: Adnoc builds long-term oil and gas production potential
    > DOWNSTREAM: Adnoc Gas to rally UAE downstream project spending
    > POWER: Large-scale IPPs drive UAE power market
    > WATER: UAE water investment broadens beyond desalination
    > CONSTRUCTION: War casts shadow over UAE construction boom
    > TRANSPORT: UAE rail momentum grows as trade routes face strain

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16553627/main.gif
    MEED Editorial
  • Firms announce 129MW Dubai data centre

    24 April 2026

    Dubai’s Integrated Economic Zones Authority (DIEZ) has signed a joint-venture agreement with Netherlands-headquartered data centre developer Volt to build a new artificial intelligence (AI)-ready data centre in the emirate.

    Planned for Dubai Silicon Oasis, the development will take the form of a campus covering up to 60,000 square metres.

    The project will be delivered in two phases, starting with 29MW of immediately available capacity, followed by a second phase adding a further 100MW of committed power.

    Under the arrangement, DIEZ will supply the land and essential infrastructure, while Volt will finance and develop the project, lead construction, and manage the design, leasing, implementation and day-to-day operations.

    French firm Schneider Electric, which has its regional headquarters in Dubai Silicon Oasis, will support the development by supplying advanced electrical systems, power distribution capabilities and smart data centre infrastructure.

    The GCC currently has more than 174 active data centre projects, representing over $93bn in investment, led by international players such as AWS, Google and Huawei, alongside regional developers including Khazna and Moro, supported by government-led localisation strategies.

    More than a dozen large-scale facilities valued at over $100m each are currently under tender, with further packages expected to reach the market over the next six to 12 months.

    The UAE is one of the leading data centre markets, with hyperscale campuses, sovereign cloud initiatives and edge data centre deployments underway.

    Data centre development is closely aligned with the UAE’s digital economy and AI roadmap, as well as the wider smart city programme.

    Priorities include hyperscale and colocation facilities to support cloud service providers; edge data centres to reduce latency and enable 5G and IoT use cases; energy-efficient designs using advanced cooling, modular construction and renewables; and strategic partnerships between global hyperscalers, local developers and utilities.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16548972/main.JPG
    Yasir Iqbal
  • Iraq signs upstream oil contract

    24 April 2026

    State-owned Iraqi Drilling Company (IDC) has signed a contract with China’s EBS Petroleum for a project to drill 17 horizontal wells in the southeastern portion of the East Baghdad field.

    Mohamed Hantoush, the general manager of IDC, said the contract signing came after a “series of successful achievements” by the company at the field.

    The achievements included the completion of a project to drill 27 horizontal wells and another project to drill 18 horizontal wells, according to a statement released by Iraq’s Ministry of Oil.

    In January, Iraq’s Midland Oil Company (MOC), in collaboration with EBS Petroleum, completed the country’s longest horizontal oil well in the southern part of the East Baghdad field.

    The well, which was called EBMK-8-1H, reached a total depth of 6,320 metres, and had a 3,535-metre horizontal section, making it the country’s largest horizontal well ever drilled.

    Senior officials from the Iraqi Oil Ministry and representatives of EBS Petroleum attended the well’s completion ceremony.

    EBS Petroleum is a subsidiary of China’s ZhenHua Oil, which is focused on Iraq.

    ZhenHua Oil is the operator of the field and is working with Iraqi partners to oversee the field’s development.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16543675/main4942.jpg
    Wil Crisp
  • Jordan tenders oil and gas terminal project

    24 April 2026

     

    Jordan’s Aqaba Development Corporation (ADC) has tendered a project for the development of the facilities at the Aqaba Oil and Gas Terminal.

    The project has been divided into two packages, and a bid deadline has been set for 15 June 2026.

    The oil and gas terminal is located south of the city of Aqaba in Jordan’s Southern Industrial Zone.

    The scope of Package 1 includes:

    • Rehabilitation of petroleum product pipelines of various sizes and their accessories (such as supports, structures and valves), including rectification of painting defects
    • Inspection and repair of pipe welds
    • Rectification and overall maintenance of the product booster pump
    • Inspection, maintenance, testing and commissioning of liquefied petroleum gas (LPG) booster pumps
    • Rectification of two overhead cranes
    • Rectification and calibration of instrumentation, including pressure indicators and valves

    The scope of Package 2 includes:

    • Rehabilitation of control rooms and security rooms, replacing them with concrete control rooms, including infrastructure works and all required services
    • Removal of unused tanks and equipment previously used for exporting crude oil
    • Rehabilitation of the existing gate in order to improve safety and security with the installation of a tire killer
    • Carrying out maintenance and repairs for the oil berth dolphins and trestle with inspection
    • Maintenance, repair and reinstallation of oil berth concrete slabs
    • Removal and extension of the jetty platform
    • Installation of a lighting system at pipelines beside booster pumps
    • Installation of stripping pumps at the LPG terminal
    • Replacement of drain line path for slop tank of LPG booster pumps
    • Rehabilitation of the existing closed drain drum
    • Rectification of cone sealing issue of all truck loading arms
    • Conversion of manual valves to motor-operated valves
    • Remote operation of shut-off valves on the main pipeline alongside and near the entrance gate
    • Upgrading of the firefighting system

    The last date for questions and clarifications related to the project will be 13 May 2026.

    The Aquaba Oil and Gas Terminal was built to meet demand for petroleum products and LPG imports into Jordan.

    It is operated by state-owned Jordan Oil Terminals Company (JOTC), which was established in 2015 as a private shareholding company.

    Earlier this year, Abu Dhabi’s AD Ports Group signed an agreement with ADC to manage and operate the Aqaba multipurpose port.

    AD Ports is managing and operating the port under a 30-year concession agreement.

    Under the agreement, AD Ports and ADC will establish a joint venture to oversee port operations.

    AD Ports will hold a 70% stake in the joint venture, with the remaining 30% held by ADC.

    AD Ports Group will also invest AED141m ($38.4m) in the joint venture.

    The signing ceremony was held at the Aqaba Special Economic Zone Authority headquarters in Aqaba on 5 February.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16543632/main.jpg
    Wil Crisp