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.

Exclusive from Meed
-
Iraq sets up commission for $5bn pipeline project30 April 2026
-
Construction begins on Dubai Healthcare City projects30 April 2026
-
Bahrain extends bid deadline for 1.2GW Sitra IWPP30 April 2026
-
Bidders get more time for Jebel Ali sewage EPC contract29 April 2026
-
UAE’s departure from Opec marks a tectonic shift29 April 2026
All of this is only 1% of what MEED.com has to offer
Subscribe now and unlock all the 153,671 articles on MEED.com
- All the latest news, data, and market intelligence across MENA at your fingerprints
- First-hand updates and inside information on projects, clients and competitors that matter to you
- 20 years' archive of information, data, and news for you to access at your convenience
- Strategize to succeed and minimise risks with timely analysis of current and future market trends
Related Articles
-
Iraq sets up commission for $5bn pipeline project30 April 2026
Iraq is setting up a high-level commission to oversee the development of the planned $5bn Basra-Haditha crude oil pipeline project.
The decision was made at a meeting held on 26 April, attended by Prime Minister Mohammed Shia Al-Sudani and the Minister of Petroleum Hayyan Abdul Ghani Al-Sawad, as well as other officials and consultants.
The commission will be chaired by the undersecretary of the Oil Ministry and include advisers to the prime minister, along with director-generals from the Oil Ministry and the Industry & Minerals Ministry.
Al-Sudani said the pipeline project will increase flexibility in transporting crude oil to the Turkish port of Ceyhan, as well as the Syrian port of Baniyas and Jordan’s port of Aqaba.
The pipeline is also expected to strengthen supply to refineries in central and northern Iraq and support higher domestic refining output.
The meeting also approved allocating $1.5bn to the project this year, with funding provided through the Iraq-China oil-for-infrastructure mechanism, according to a statement issued by the Petroleum Ministry.
Earlier this month, Iraq’s Council of Ministers approved amendments allowing the Oil Ministry to directly invite specialised companies to bid for the 685-kilometre pipeline.
The pipeline is expected to have a capacity of up to 2.25 million barrels a day.
https://image.digitalinsightresearch.in/uploads/NewsArticle/16621546/main.jpg -
Construction begins on Dubai Healthcare City projects30 April 2026
Dubai Healthcare City Authority (DHCA) has begun construction on Pixel DHCC and Ibn Sina+, two flagship developments in Dubai Healthcare City.
Local contractor International Foundation Group has been appointed to carry out the enabling works.
The two projects form part of Phase 1 of DHCA’s AED1.3bn ($354m) development programme and are scheduled for completion in November 2027.
Pixel DHCC, designed by Hong Kong-based P&T Architects and Engineers, is planned as Dubai Healthcare City’s first LEED Platinum-certified office building. The nine-storey commercial development will cover 13,000 sq m.
Ibn Sina+, designed by Dubai’s Design and Architecture Bureau, will be a five-storey medical complex spanning 5,800 sq m.
— Dubai Media Office (@DXBMediaOffice) April 27, 2026
https://image.digitalinsightresearch.in/uploads/NewsArticle/16611156/main.jpg -
Bahrain extends bid deadline for 1.2GW Sitra IWPP30 April 2026

Bahrain’s Electricity & Water Authority (EWA) has extended the developer bidding deadline for the Sitra independent water and power plant (IWPP).
The new deadline is 17 May.
The Sitra IWPP is a combined-cycle gas turbine plant expected to have a generation capacity of about 1,200MW of electricity.
The project’s seawater reverse osmosis desalination facility will have a production capacity of 30 million imperial gallons a day (MIGD).
It is the second deadline extension on the main works package since the tender was released in August 2025.
Lebanon-headquartered Khatib & Alami was recently awarded a consulting contract for the project, worth $1.91m. This was despite the consultancy submitting only the third-lowest bid behind Spain’s Ayesa ($1.25m) and WSP Middle East Architectural & Engineering ($1.27m).
EWA’s transaction advisory team for the project comprises KPMG Fakhro as the financial consultant and Trowers & Hamlins as the legal consultant.
MEED previously reported that seven international companies and consortiums had prequalified to bid. These are:
- Abu Dhabi National Energy Company (Taqa, UAE)
- Acwa Power (Saudi Arabia)
- China Energy Engineering Corporation / China Datang (Overseas Hong Kong, China)
- Gulf Investment Corporation (Kuwait)
- Jera (Japan)
- Korea Electric Power Corporation (Kepco, South Korea)
- Sumitomo Corporation (Japan)
EWA first received statements of qualifications from nine interested firms in December 2024.
The build-own-operate (BOO) project is being procured under a public-private partnership framework for 20-25 years.
It is Bahrain’s fourth IWPP, replacing the previously planned Al-Dur 3. The Sitra IWPP is expected to be fully operational by the second quarter of 2029.
The project is in line with EWA’s plan to replace old plants with new, more efficient ones that reduce natural gas consumption.
Procurement for the Sitra IWPP is advancing in parallel to other EWA initiatives, including the planned 60MIGD Al-Hidd independent water plant (IWP), for which two bids were submitted earlier this year.
The contract to develop and operate the state’s first IWP remains under bid evaluation, a source said.
https://image.digitalinsightresearch.in/uploads/NewsArticle/16611117/main.jpg -
Bidders get more time for Jebel Ali sewage EPC contract29 April 2026

Dubai Municipality has extended the deadline for contractors to submit bids for a contract covering the expansion of the Jebel Ali sewage treatment plant (STP) phases one and two.
Contractors now have until June to submit offers, a source told MEED. Bidding had been expected to close on 30 April.
The upgraded facility will be capable of treating an additional sewage flow of 100,000 cubic metres a day (cm/d), with the expansion estimated to cost $300m.
The scope includes the design, construction and commissioning of infrastructure and systems required to support the increased capacity.
Located on a 670-hectare site in Jebel Ali, the original wastewater facility has a treatment capacity of about 675,000 cm/d following the completion of phase two in 2019, combining approximately 300,000 cm/d from phase one and 375,000 cm/d from phase two.
The main element of the expansion involves modifications to the secondary treatment process at Jebel Ali STP phase two.
UK-headquartered KPMG and UAE-based Tribe Infrastructure are serving as financial advisers on the project.
Future expansion
It is understood that the project is part of long-term plans to treat about 1.05 million cm/d once all future phases are completed.
According to sources, this includes a Jebel Ali-based build-operate-transfer (BOT) project to be developed under a public-private partnership (PPP) model.
It is understood that the prequalification process for this will begin in the coming months.
In February, MEED exclusively revealed that the municipality is preparing to tender the main construction package for the Warsan STP by the end of the year.
As MEED understands, the Warsan STP had previously been planned as a PPP project.
The main package will now be procured as an engineering, procurement and construction contract, a source said.
The project involves the construction of a sewage treatment plant with a capacity of about 175,000 cm/d, including treatment units, sludge handling systems and associated infrastructure.
https://image.digitalinsightresearch.in/uploads/NewsArticle/16608027/main.jpg -
UAE’s departure from Opec marks a tectonic shift29 April 2026
Commentary
Indrajit Sen
Oil & gas editorRegister for MEED’s 14-day trial access
The UAE’s decision to leave Opec and the Opec+ grouping marks a significant turning point in global oil markets and highlights shifting geopolitical dynamics and evolving supply expectations.
The UAE announced it will leave the producer alliance effective 1 May, ending nearly six decades of membership. The move reflects a broader strategic shift, as the country seeks greater flexibility over its production policy amid rising capacity and changing market conditions.
For oil markets, this is about more than one country wanting to pump more oil. Abu Dhabi National Oil Company (Adnoc) has spent billions of dollars over the years to raise crude production capacity to 5 million barrels a day.
Opec+ quotas had increasingly looked as though they were stifling Abu Dhabi’s growing desire to maximise revenues by tapping into its expanded spare capacity. Leaving the Opec+ coalition gives Abu Dhabi more room to monetise those investments.
The timing also matters. It comes against a backdrop of regional security concerns, tensions around Iran and the Strait of Hormuz, and a sense that consumers are once again being squeezed by high energy costs and depleted strategic reserves.
The immediate dip in the price of global benchmark Brent crude following the announcement of the UAE’s decision on 28 April showed the market’s first instinct: more UAE barrels could mean more supply and lower prices. However, the price rebound on 29 April, with Brent trading around $111 a barrel, also tells the other half of the story: extra capacity does not instantly become risk-free supply when regional bottlenecks and security threats remain front and centre.
For Opec+, this is a blow to unity and to Saudi Arabia’s ability to marshal producer discipline. It does not mean that a price war will start tomorrow, but it raises the risk of other member states choosing to abandon the alliance’s cooperation mechanism and pursue a higher market share. In trading terms, this adds a new volatility premium: more potential supply, less cartel discipline and a Gulf energy landscape that looks significantly less predictable.
The announcement comes at a time of heightened uncertainty in global energy markets, with geopolitical tensions, supply chain constraints and demand recovery trends all contributing to price volatility. The UAE’s exit is expected to reshape market expectations around supply flexibility and producer coordination.
https://image.digitalinsightresearch.in/uploads/NewsArticle/16608006/main.gif