Saudi Arabia solar tariffs jump 43% on higher module costs

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ACWA Power was among the shortlisted bidders in the latest tender. Image: ACWA Power.

Shortlisted bids in Saudi Arabia’s latest solar tender have jumped significantly on the lowest price recorded in the country’s previous renewables programme, reflecting the hikes in PV equipment costs in recent months.

Tendering for the development of four solar PV projects with a combined capacity of 1.2GW, round three of Saudi Arabia’s renewable energy programme saw Jinko Power post the lowest bid of SAR 0.05563/kWh (US$0.01483/kWh) – a 43% increase on a bid of US$0.0104/kWh recorded in the scheme second’s round that the country’s ministry of energy said earlier this year was a world record low solar tariff.

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The jump in lowest bids comes after global polysilicon prices reached a new annual high earlier this month, while some module prices have risen to above US$0.30c/W – levels not seen since 2019 – on the back of increased raw materials and transportation costs.

Jinko Power’s lowest bid in the latest tender was for the 300MW Saad project, however the company was beaten on price for the 700MW Ar Rass plant, which saw a consortium led by Saudi Arabian developer ACWA Power submit a bid of SAR 0.05623 (US$0.01499).

Saudi Arabia’s ministry of energy said these two larger projects are targeted towards attracting international developers to further invest in the country.

The lowest shortlisted bids for the two other plants in the tender, the 120MW Wadi Ad Dawasir and 80MW Layla installations, were posted by consortiums led by France’s TotalEnergies and ACWA Power, respectively.

Successful bidders will enter into a 25-year power purchase agreement with the Saudi Power Procurement Company as an offtaker.

Saudi Arabia’s ministry of energy said earlier this year that the world record low bid in the tender’s second round was for the Shuaibah project, which has been renamed from Al-Faisaliah since shortlisted bidders were revealed last year.

After ACWA Power and Abu Dhabi-based renewables developer Masdar posted “extremely close” initial bids, the ministry decided to have the two consortia compete under a ‘best and final offer’ approach. It was revealed earlier this year that ACWA Power will proceed with developing the project.

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