Saudi Arabia’s electricity privatisation plans preparing ground for solar

First Solar's Dubai project. The UAE has stolen a march on Saudi Arabia in terms of solar deployment. Credit: First Solar.

Saudi Arabia’s plans to privatise its electricity sector will also include a pivot towards renewable energy sources, according to press reports in the kingdom.

The Saudi Electricity Company plans to split into four units with local and international companies able to take stakes in the new firms.

A local paper, citing sources close the government, claims that the plan for the changes also includes a transition to renewable sources.

Solar PV is already competitive with natural gas generation in the region so any changes to the country’s electricity structure that increases exposure to market forces would be likely to result in additional solar generation.

Last week, an official from SEC told Saudi news network Al-Arabiya that the break-up of SEC would be completed by the end of 2016. The plans must still be approved by a ministerial committee.

With oil revenues down, Gulf countries have increasingly had to turn to public-private partnerships for infrastructure investments. Dubai is currently tendering for 800MW while neighbouring emirate Abu Dhabi has 350MW up for grabs.

In total, more than 4GW of solar is available in Middle East state-run tenders in 2016 with Egypt also adding capacity in direct partnerships.

Tags: middle east, saudi arabia