Investment in the Middle East solar sector could top $50 billion by the year 2020 as demand for energy soars in the region and existing fossil fuel resources face increasing strain.
A new report from the Middle East Solar Industry Association (MESIA). report states that up to 37,000MW of new solar, wind and hydroelectric projects are planned to be commissioned throughout MENA (Middle East/North Africa) nations by the end of the decade.
Solar photovoltaic (PV) and concentrating solar power technologies could account for between 12,000MW and 15,000MW of the energy mix.
With some of the highest solar radiation levels in the world, MENA leaders are embracing renewables, particularly solar power, as a hedge against a potential future energy crisis as once-plentiful oil wells dry up.
“Prior work by MESIA has shown that solar power has become commercially viable in the MENA region due to dramatic reductions in solar equipment costs, a good fit of solar resources with regional power demand patterns, and increasingly limited access to cheap hydrocarbons for power generation,” says Dr Steve Griffiths, Research Director at MESIA.
But with installed solar capacity contributing just 271MW of the 260,000MWs of the overall installed electricity generating capacity of the 14 MENA nations as of January 2014, much work needs to be done by governments to attract necessary investment.
“Currently, there lacks a cohesive approach to developing a renewable energy industry,” says Ed James, Head of MEED Insight and report author. “Governments need to provide the necessary financial and regulatory incentives such as feed-in tariff, net metering and tax breaks if investment is to be attracted and to grow. While there is evidence that this is happening, it needs to accelerate if the ambitious 2020 targets are to be achieved.”
Saudi Arabia has positioned itself as the region’s renewable and solar energy leader, with a target of 23,900MW by 2020, and Morocco, Egypt and Algeria planning to put at least 1,500MW, 1,800MW and 3,000MW of solar power in place respectively. These plans, according to Griffiths, are evidence that the region is on track to meet its investment target of $50 billion.
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