Saudi Arabia shortlists bidders for first solar power project
Published: 09 Jan 2018 By Matt Cook
Saudi Arabia has now shortlisted bids by Acwa Power and a consortium operated by Marubeni to create the kingdoms first solar power project. Saudi Arabia intends to develop alternative energy sources and remove reliance on the oil export industry.
The bids were selected by the Renewable energy Project Development Office (Repdo) which was created in 2017 to oversee the renewable energy program in Saudi Arabia. Repdo chose the bids provided by the local developer and the engineering firm in Japan.
The consortium is led by Abu Dhabi clean energy business Masdar and the French business EDF Energy. The consortium led by Masdar bid for the 300MW Sakaka solar PV project in the northern region of Al Jouf came in at just under 1.80 US cents per kilowatt hour and was over 20% cheaper than the bid by Riyadh-based Acwa Power.
Repdo recently announced that all businesses had submitted a bid for the first round of the Sakaka PV project and have invited all members to participate in other planned projects under the National Renewable Energy Programme (NREP).
Saudi Arabia is the largest exporter of oil in the world but is now looking to shift its reliance away from the oil and gas industry. The nation is now targeting the development of nearly 4 GW of renewable energy by 2020 under its newly launched ‘National Transformation Programme’. This programme also includes the development of nearly 10 GW of renewable energy capacity within the next five years.
Repdo announced that the solar PV project at Sakaka is due to be given to the selected bidder shortly and will gain further support from an energy purchase agreement with Saudi Power Procurement Co.
The decision by Saudi Arabia to not go to the lowest bidder suggests that the country is possible looking at prioritizing quality over price. Financial experts have suggested that Saudi Arabia is placing more importance on ensuring this project is focused on quality over providing cheap prices.
Saudi Arabia is also looking to construct its first wind project, a 400MW facility at Al Dumat Al-Jandal.
Masdar, GE, Marubeni Corporation, Mitsui & Co., JGC Corp, SNC Lavalin Arabia and Iberdrola Renovables Energia are the companies qualified to bid for the proposed wind farm project. Saudi Energy Minister has emphasized that market response towards the Kingdom’s first renewable energy projects have been very positive and highlights confidence in the market and potential of the renewable energy industry in the region.
In line with the Vision 2030, Saudi Arabia is targeting 9.5GW of renewable energy by 2023 as part of its economic reforms and diversification away from the oil and gas market. The renewable energy program will include an investment of nearly $50 billion within the next five years. Explore the latest solar and renewable energy jobs in the Middle East today.