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Despite an unprecedented year, presenting health, economic and financial challenges, a new era towards solar energy is continuing to thrive, as revealed in the upcoming Middle East Industry Association, 2021 Solar Market Outlook report
As discussed during the presentation, on one hand, the impact of COVID 19, combined with the economic and financial consequences of the drop of oil and gas prices, have triggered some slowdown in the completion of tenders and launch of new projects in MENA. Reduced electricity demand in some countries could support some temporary rescheduling of investment in additional power production capacity and in some cases to curtailment, waiting for stronger recovery.
On the other hand, the past year has seen continued improvements of competitiveness of solar thanks to further decrease in price of solar modules, increasing technological progress (eg modules batteries, inverters ) and use of smart digital tools and improved risk mitigation methodologies. The industry has also demonstrated during the COVID-19 crisis its resilience and capacity to develop ingenious solutions to overcome the issues of supply, manpower and access to sites and reach out to client. In many ways the crisis has positioned solar at the forefront, as a sustainable and reliable source of energy. Moreover, the COVID 19 pandemic has been an awakening and triggered larger socio – political support for a “greener” and more sustainable world.
It is expected that rapid development of solar will resume with economic growth will resume and governments giving more importance to fighting climate change and increasing the share of renewable energy. The prospect of Green Hydrogen becoming the new “oil” of the region and Clean hydrogen projects on the rise in a number of MENA countries ( e.g. Morocco, KSA, Oman, UAE) will play a major role in the coming years in supporting the addition of new solar capacity in MENA.
In the Middle East and North Africa (MENA) region, in particular, countries have progressed in reaching their renewable energy targets and new projects have come online. Major highlights from 2020 include:
Countries like Algeria, Morocco, KSA, Oman launched new tenders for additional solar capacity. By 2024, the total global installed solar power capacity is projected to almost double to reach 1300 GW. According to BNEF, total installed capacity of solar in MENA has further increased in 2020 by 4,3 GW and is expected to grow by a further 1.8 GW in 2021 to potentially amount up to 8,3 GW by 2022 to meet the countries’ target.
Frost & Sullivan’s recent analysis, Solar PV Dominating Investment Opportunities in Renewable Sector across the Middle East, 2020-2025, expects possible additional investment in solar in MENA by 2025 at $182.3 billion.
Today, solar and other renewable energy sources are already paving the way toward electrification and decarbonization of end usages. Green hydrogen could provide the long-term flexibility required for large integration of solar into the energy system, solving intermittency, storage and transportation of REN issues, one can expect that commitments of countries of the region to meet their objectives of increased share of renewable energy will be met and possibly reinforced while solar for C&I will continue to pick up
Discover some of the strategies, challenges and current updates for solar in the region by downloading the report on MESIA website at www.mesia.com