Saudi Arabia Renewables Report - Business Monitor International - Industry Reports

Saudi Arabia Renewables Report

Saudi Arabia Renewables Report - Business Monitor International - Industry Reports
Saudi Arabia Renewables Report
Published Oct 08, 2016
33 pages — Published Oct 08, 2016
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Abstract:

We were initially optimistic with regards to the targets; our view was underpinned by the strong government commitment to diversification of the power mix away from oil to conserve it for export, coupled with the very high demand for power in the country. We still expect power consumption to grow by an annual average of -.- between ---- and ----). ...However, we believe that Saudi Arabia s ambitious solar expansion plans will not be realised, even in their currently more realistic form. This is because a sustained period of lower oil prices will prompt the government to prioritise the natural gas-fired power sector over renewables, while stringent local content requirements and a lack of a clear procurement mechanism for renewables projects will hamper private sector investment in the market. With the government focusing on fiscal consolidation, it is unlikely to commit the necessary funding to kick-start a nascent solar power sector. ...We therefore expect the difficult climate for public spending to continue to provide an obstacle to any significant expansion in the solar power sector - both in terms of manufacturing and installed capacity.

...As a follow-up to its Vision ---- reform plan - which mandates -.-GW of renewables to be installed in the kingdom - the Saudi Arabian government has released the National Transformation Program ---- (NTP). The NTP sets an interim target of -,---MW of non-hydro renewables capacity to be installed in Saudi Arabia by ----; moreover, it mandates that renewable energy account for - of the country s total energy use by the same year. While we view these targets as more achievable than earlier incarnations of the kingdom s renewables capacity expansion scheme, we do not expect them to be met. Our bearish growth outlook for the industry - and particular for the solar sector, which will be the technology of choice in the kingdom - is premised on the country s local content requirements in the face of the absence of a domestic supply chain; in the fiscal consolidation enacted by the government, which will prompt it to concentrate on natural gas-fired power generation; and the lack of policies to support growth, such as a clear programme of reverse capacity auctions. In late July, the Saudi Electricity Company (SEC) issued a request for two --MW solar photovoltaic power projects, to be developed by independent power producers and located in the Al-Jawf and Rafha regions of Saudi Arabia. SEC will reportedly launch tender documents to prequalified groups by October --, with the bid submission date anticipated in early ----. The winner will be required to develop the solar PV projects on the land procured by SEC and sell the plants entire output to the state-owned power utility under a long-term power purchase agreement.

...As a follow-up to its Vision ---- reform plan - which mandates -.-GW of renewables to be installed in the country - the Saudi Arabian government has released the National Transformation Program ---- (NTP). The NTP plan sets an interim target for -,---MW of non-hydro renewables capacity to be installed in Saudi Arabia by ----; moreover, it mandates that renewable energy account for - of the country s total energy use by the same year. ...

  
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Document ID
2058-6493
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Business Monitor International - Industry Reports—Established in 1984, Business Monitor International is a leading online publisher of specialist business information on global emerging markets. Business Monitor's range of quarterly services covers political risk, finance, macroeconomic performance, outlook and forecast, industry sectors and the business operating environment. Each Industry Report has been researched at source, and features latest-available data covering production, sales, imports and exports; 5-year industry forecasts through end-2012; company rankings and competitive landscapes for multinational and local manufacturers and suppliers; and analysis of latest industry developments, trends and regulatory changes.

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MLA:
Business Monitor International - Industry Reports. "Saudi Arabia Renewables Report" Oct 08, 2016. Alacra Store. Dec 09, 2016. <http://www.alacrastore.com/storecontent/Business-Monitor-International-Industry-Reports/Saudi-Arabia-Renewables-Report-2026-1749>
  
APA:
Business Monitor International - Industry Reports. (2016). Saudi Arabia Renewables Report Oct 08, 2016. New York, NY: Alacra Store. Retrieved Dec 09, 2016 from <http://www.alacrastore.com/storecontent/Business-Monitor-International-Industry-Reports/Saudi-Arabia-Renewables-Report-2026-1749>
  
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