A report predicting that more than 4 gigawatts of solar power projects are planned across the Middle East for this year has drawn mixed reactions from observers.
The tender prediction in the Middle East Solar Outlook for 2016, published by the Middle East Solar Industry Association (MESIA), matches the regional forecast in GTM Research’s Global PV Demand Outlook 2015-2020, published in June 2015.
But Browning Rockwell, executive director of the Solar GCC Alliance, said he thinks the numbers are more hype than reality. "Each country has obstacles beyond government-announced solar targets, policies and regulations.”
For example, in Egypt, where MESIA predicts 1.5 gigawatts being installed this year, currency challenges have stalled a feed-in tariff program, according to renewables investor Fintan Whelan.
Even strategically important oil and gas exploration activities have been hampered by payment delays caused by a lack of hard currency, Whelan noted: “If Egypt is not able to solve the dollar problem for oil and gas, how can they do it for renewables?”
The MESIA study claims 693 megawatts of centralized and distributed solar power are now operational in Algeria, Egypt, Jordan, Kuwait, Morocco, Saudi Arabia and the United Arab Emirates (UAE), and almost 2.9 gigawatts more are "under execution" (awarded or being built).
The figures include PV and solar thermal technologies and show Algeria leading in terms of operational projects, with 270 megawatts installed. The country also leads in terms of capacity to be tendered in 2016, with 2 gigawatts up for grabs.
Along with 80 megawatts currently under execution, the capacity is expected to give solar a 15 percent share of overall power generation in Algeria by 2020. “In total, Algeria aims for 13 GW of solar power by 2030,” wrote the report authors.
“Works on more than 20 different sites across the country are at different stages, and overall, more than 300 MW are expected to be operational by 2016,” noted the authors. “Increasing momentum is expected for the Algerian solar market in 2016.”
Other markets with potentially significant growth include Egypt, where MESIA says 1.8 gigawatts are under execution, and the UAE, which is due to tender 1.15 gigawatts this year.
Egypt plans to raise its share of renewable energy to 20 percent by 2022, while “the UAE has established itself as a key solar market over the past couple of years and will continue to show leadership in 2016, in particular in Dubai and Abu Dhabi,” says MESIA.
Algeria, Jordan, Morocco and the UAE are all due to get 10 percent or more of total power generation from solar by 2020, based on capacity installed, under execution and being tendered this year.
One country far behind in solar is Saudi Arabia. In 2012, the nation attracted strong interest from developers after unveiling plans for 41 gigawatts of solar power generation by 2032, with an initial 600 megawatts due for procurement in 2013.
The scheme was halted shortly afterward, though. “The delay in the launch of the Saudi solar program has had a negative impact on the overall energy economics in the kingdom,” observes the MESIA study. “But despite the industry’s disappointment regarding market delays, the Saudi solar market promises to be the jewel in the Middle East solar crown once it takes off.”
Browning believes that Saudi Arabia could announce up to 2 gigawatts of solar before the end of the year.
If so, that could help put the Middle East and North Africa back on track for to reach a previous MESIA forecast of 15 gigawatts and $50 billion in solar investments by 2020.
"The Gulf Cooperation Council and Middle East and North Africa region will experience growth pains that may slow projected growth, but we are seeing very positive indications that the market is finally moving forward in real terms, not just on paper," said Browning.
Lou Trippel, First Solar’s senior director for product management, said his company was optimistic about prospects in the region. "Clearly, the Middle East is a really exciting market for us,” he told GTM. “There are a lot of opportunities right now that we are focused on."