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Middle East to tender 4GW of solar in 2016

MESIA has released its annual Middle East Solar Outlook in which it concludes that 2016 will be characterised by increasingly lower levelised costs of solar electricity

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New solar projects to be driven by the power supply-demand imbalance
New solar projects to be driven by the power supply-demand imbalance

Solar adoption in the Middle East is projected to leap further with as much as 4,000MW of new projects lined up for tendering in 2016, according to predictions by the Middle East Solar Industry Association (MESIA).

MESIA has released its annual Middle East Solar Outlook in which it concludes that 2016 will be characterised by increasingly lower levelised costs of solar electricity.

It also expected the solar energy market to be spurred on, rather than slowed down, by low oil and gas prices.

Noting that solar is cost competitive on an unsubsidised basis, the report points to the economic impact of low hydrocarbon prices on net energy exporting nations, energy market reforms and subsidy adjustments, rising electricity prices, and growing demand for desalination and cooling, as key drivers of the region’s energy transition.

“Claims that the growth of solar energy will slow down in 2016 because of low oil prices, appear to be unfounded,” said Dr. Raed Bkayrat, Director of Research at MESIA.

“It is incorrect to assume that solar growth will need to be subsidised by petro-dollars, when all the evidence points to solar being cost competitive with every conventional energy generation resource, on an unsubsidised basis.”

“On the contrary, as countries in the region start to adjust their hydrocarbon subsidies, correct their electricity pricing strategies and seek to reduce domestic consumption of oil and gas, we expect solar to stand out as the single most attractive option for power generation.”

The report, which is sponsored by the Solar Expo, also highlights the role that solar energy can play in addressing the challenge of Peak Load demand, particularly in summer.

Noting that seasonal increases in electricity consumption - primarily as a result of increased air conditioning usage - are a significant challenge in the region, MESIA suggests that solar PV can provide a competitive alternative to conventional peak load generation assets.

“Looking at the forecast for 2016 and the very tangible developments we’ve already seen in 2015, it’s hard not to be optimistic for solar energy’s potential in the region. We’ve gone from a couple of hundred megawatts in 2013 to almost 3,000MW being tendered and developed in 2015, while an additional 4,000MW are expected to be tendered this year,” said Imitiaz Mahtab, MESIA President.

“The numbers speak for themselves and point to the fact that we’re in the midst of a tipping point for solar in the region and that we can only expect the market to grow from here.”

MESIA is the largest solar trade association in the MENA region. It represents over 150 companies including investors, installers, manufacturers, and solar professional service providers.

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