Saudi solar plant locks in new record low price for power: 1.04c/kWh

Saudi Arabia looks to have notched up a new record-low price for large-scale solar power, with one of seven projects recently signed up to power purchase agreements contracted to sell electricity for just over $US10 per megawatt-hour ($A13/MWh).

According to local press, Saudi Arabia’s energy minister Prince Abdulaziz Bin Salman announced the new record on Thursday last week at the inauguration of the 300MW Sakaka solar power plant in Al-Jouf, the kingdom’s first renewables project.

At the plant’s launch, Prince Abdulaziz announced that PPAs for seven other renewable projects across a range of regions had also been signed between the Saudi Power Procurement Company and five investment consortiums made up of 12 unnamed Saudi and international companies.

The new projects, located in Al Madinah, Sudair, Qurayyat, Shuaibah, Jeddah, Rabigh, and Rafha, will take the kingdom’s total renewable generation capacity to 3,670MW, alongside Sakaka and the 400MW Doumat Al Jandal wind project.

But one, in particular, the 600MW Shuaibah solar project to be developed by a consortium of ACWA Power, Gulf Investment and Al Babtain Contracting, had achieved a record low cost of electricity at $US10.40 per MWh, Prince Abdulaziz said.

This beats the previous global record low claimed by Portugal in August of last year, when its second solar PV tender included one lot awarded at €11.14/MWh, or around $A18.17/MWh, and 25 per cent below its previous record.

Before that, in July, the Emirates Water and Electricity Company (EWEC) awarded a contract to build the 2GW Al Dhafra Solar PV project in Abu Dhabi at a then record-low tariff for solar power of $US0.0135/kWh ($US13.50/MWh)

“These projects are a practical on-the-ground application of Saudi Vision 2030, that contributes to the optimisation of the energy mix and the transformation of the Kingdom from the use of liquid fuel to gas and renewables, which makes these projects significant landmarks in the journey of the energy sector,” the energy minister said, as quoted in the Saudi Gazette.

Completing these projects and connecting them to the national grid, the Prince reportedly said, would help the Kingdom meet its national electricity needs, promote the reliability of its grid, and support its ambition to become a global leader in the export of renewables.

Saudi Arabia’s Crown Prince Mohammed bin Salman also welcomed the news of the new contracts – and the launched of the Sakaka solar farm, which he described as the “first steps to utilise renewable energy in the Kingdom.”

“During the past weeks, the Saudi Green Initiative and the Middle East Green Initiative have been announced, which showed that we, as a leading global oil producer, are fully aware of our share of the responsibility in advancing the fight against climate change,” he said, quoted in Arab News.

“Some of these projects have achieved new records, where we registered the lowest cost of purchasing electricity produced from solar energy in the world.”