Middle East on track to triple renewables capacity

Allstar Picture Library/Alamy via Reuters Connect

• 2030 target is 150GW
• Saudi Arabia leads the way
• Solar power driving capacity

Middle East and North African countries are on track to triple their renewable capacity by 2030, mainly due to expansion of solar photovoltaic projects, the International Energy Agency has said.

Renewables are forecast to increase from 53GW in 2023 to almost 150GW by the end of the decade, in which solar PV is expected to account for more than 85 percent in the region.

Saudi Arabia is set to dominate the growth, accounting for more than 40 percent of renewable capacity expansion by 2030.

The UAE, Oman, Egypt, Iraq, Morocco and Israel will represent another 44 percent, according to the IEA’s report, which came out on Wednesday. 

Fatih Birol, the IEA’s managing director, said that policy incentives allow the Middle East to take advantage of the cost-competitiveness of solar PV and its “huge potential”.

“Owing to good solar resources, economies of scale, and beneficial land and financing costs, the region continues to produce winning bids at the lower end of the world’s awarded bid range,” the IEA said.

Last year, round 4 of Saudi Arabia’s Repdo auction awards averaged $16.8-17/MWh for plants of 400MW to 1.1GW.

Wadii Fekkar/Alamy via Reuters Connect

The growth of renewables in the region is also driven by rising electricity demand. Countries deploy renewables to either reduce electricity imports or free up domestic fossil fuels for exports. 

“Countries like the UAE and Saudi Arabia have ambitious solar policies,” said Birol. “If these targets are achieved, it will be good for the oil industry because fuel used for electricity generation could be freed up and exported, [to earn] revenues,” Birol said.

Saudi Arabia plans to reach 130GW of renewable capacity by 2030. Its installed renewables capacity more than tripled in 2023.

The UAE has invested $45 billion in clean energy. “Over the next six years, we plan to invest an additional $54 billion in the clean energy strategy,” Sharif Al Olama, the Emirates’ undersecretary for energy and petroleum affairs, told an energy transition conference in Abu Dhabi on Wednesday.

The Mena region should also see the expansion of wind onshore capacity, driven by the development of hydrogen projects that could reach nearly 10GW.

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By 2030 it will account for 40 percent of wind expansion led by Saudi Arabia, Oman and Egypt. 

Globally, “renewables are overpowering other sources of energy”, said Birol. “Their expansion is driven by economics.”

Their capacity has increased by 20 percent between 2023 and 2024 to 670GW and is on course to meet almost half of global electricity demand by the end of this decade. 

By 2030 the IEA expects renewables to reach 10,800GW. “This is equal to the entire power system of the US, China, EU and India,” said Birol.

About 60 percent of this expansion is anticipated to come from China. By 2030 it will be home to almost half of the world’s total renewable power capacity, while the Middle East will account for 2 percent.

Cop28 in Dubai called on governments and the private sector to triple global renewable energy capacity to at least 11,000GW to meet the Paris Agreement’s 1.5C scenario. 

“We are not yet exactly there, but close – reaching 2.7 times growth instead of tripling,” said Birol.