The solar market in the Middle East and North Africa (MENA) region is growing by leaps and bounds as large-scale solar power projects continue to be commissioned, and several countries as Morocco, Egypt and the UAE launch additional phases of their renewable energy and solar programs. Even decentralized and rooftop solar is picking up pace. Yet, more can be done with the help of favorable regulatory framework and removal of fossil fuel subsidies, suggests the Middle East Solar Industry Association (MESIA) in its Annual Solar Outlook Report 2020.
Among major trends that will drive the solar power industry forward between 2019 to 2021 according to MESIA, decrease in solar prices, pushed also by a demand slump in China, will work to increase demand in the Middle East. Distributed generation is also likely to grow its clout, led by the UAE, especially Dubai as it steams ahead with its Shams Dubai program.
Recently, Qatar earned the distinction of attracting one of the world’s lowest solar PV tariffs of QAR 0.0571 ($0.01567) per kWh for its 800 MW tender (see Record Low Winning Bid In 800 MW Qatar PV Tender).
Out of the major markets in the region, as covered by the report, Egypt is the one to look out for as it moves towards competitive auctions based on bilateral contracts with spot, balancing, and ancillary services markets. In Saudi Arabia, a stronger dialogue between the public and private sector is anticipated to speed up the expansion of the solar market. Tunisia expects to attract $2 billion of foreign investment for wind and solar power projects over the next three years, making it yet another important regional market.
The association sees commercial scale solar development in the MENA region facing typical grid parity challenges. They ask for favorable policy and legislation, highlight a lack of awareness as well as trained manpower and see the issue of easy availability to financing.
“Diffusion of rules of local content are challenging companies, underlining the need to fully integrate the development of solar capacity in the pursuit of economic diversification, industrialization and employment of the countries of the region,” states MESIA. “Clarity of conditions and open dialogue between authorities and the private sector will be necessary to support further investment in the sector.”
The report is available for free download on MESIA’s website.
Last year in a report prepared ahead of a Solarplaza event, MESIA said the MENA region is likely to see solar power projects worth $15 billion coming online over the next five years (see Solar Projects Worth $15Bn To Come Online In MENA).