Middle East projected to surpass 100 GW of solar capacity by 2030

The Sakaka solar power plant in Saudi Arabia. Source: ACWA Power

The Middle East is turning to renewables as the oil and gas producing region sees rapid population and power demand growth, says Rystad Energy.

Renewable energy sources, including hydro, are expected to account for 70% of the Middle East's power generation mix by 2050, up from only 5% recorded at the end of 2023, according to a research by the company. Solar will be the leading source with a share of over 50% by 2050.

Over this period, the region’s power demand is projected to grow to about 2,000 TWh from 1,200 TWh now.

The share of gas in the power generation mix, which was 74% at the end of 2023, is expected to decline to 46% in 2040 and 22% by 2050. By 2030, some 30% of the Middle East ’s installed capacity is seen to come from renewables, with the potential to reach 75% by the middle of the century. Battery energy storage is also expected to experience significant growth in the 2030s.

Nishant Kumar, renewables and power analyst at Rystad Energy commented that the Middle East trails behind in the renewable energy shift, but faces surging power demand. “This, coupled with the need for economic diversification and freshwater through desalination, underscores the urgency for a transition to renewables,” the analyst added.

Solar energy is becoming key in Middle Eastern energy policies. In Saudi Arabia, solar photovoltaic (PV) has the world's lowest levelised cost of electricity (LCOE) of USD 10.4 (EUR 9.6) per MWh, Rystad Energy noted.

At the end of 2023, the Middle East had over 16 GW of solar capacity, expected to approach 23 GW by the end of 2024 and surpass 100 GW by 2030, with Saudi Arabia, the UAE, Oman, and Israel accounting for nearly two-thirds of the latter figure. Green hydrogen projects will contribute to an annual growth rate of 30%.