The Middle-East and Africa distributed solar power generation market is expected to register a CAGR of more than 8% during the forecast period of 2020 – 2025. Factors, such as rising environmental concerns and government policies for incentives and tax benefits for solar panel installation, are expected to be major factors driving the market. Moreover, advancement in technology leading to solar panel manufacturing cost reduction and increase in efficiency have been major factors for the growth of the distributed solar power generation market in the Middle-East and Africa region. On the other hand, high initial costs, lack of general awareness, and constitutional issues are some of the factors that are expected to hinder the market growth over the forecast period.

  • The shift from conventional power generation sources, such as diesel and gas gensets, to solar and hybrid power solutions is expected to help the distributed solar power generation market grow.
  • The innovation of new technologies and the upcoming solar power projects, along with the use of hybrid power solutions in this region, can create immense opportunities for distributed solar power generation market in the near future.
  • Saudi Arabia is expected to witness significant demand, owing to the number of on-going and upcoming projects over the forecast period.

Key Market Trends

Increasing Demand for Clean Electricity to Drive the Market

  • Clean energy, which includes renewables, such as solar and wind power, as well as alternative fuels, including waste-to-energy and nuclear, accounts for only a small proportion of electricity generation in the region.
  • Rooftop solar offers the benefits of modern electricity services to households that had no access to electricity, reducing electricity costs on islands and in other remote locations that are dependent on oil-fired generation, as well as enabling residents and small businesses to generate electricity.
  • Several milestones in the push for clean energy across the region were reached in 2019, including the commissioning of one of the world’s largest single-site photovoltaic (PV) solar plant, the 1.17 GW Sweihan independent power project (IPP) in Abu Dhabi.
  • After the commissioning of the Sweihan plant in March, neighboring emirate Dubai reached financial close for a USD 4.3 billion concentrated solar power (CSP) project, the largest single-site power investment project in the world.
  • Saudi Arabia’s target to install 58.7 GW of renewable energy by 2030 may offer some of the most exciting opportunities for regional and international investors and energy firms. The United Arab Emirates is expected to remain a focal point of the clean energy transition, having set a target of 50% of its energy to be produced by carbon-free sources by 2050.
  • Therefore, based on above-mentioned factors, clean electricity is expected to drive distributed solar power generation market in the Middle-East and Africa region over the forecast period.

Saudi Arabia to Witness Significant Demand

  • As of 2019, the solar power installed capacity for Middle-East and Africa was 13,026 MW. Moreover, the installed capacity for Saudi Arabia in 2019 was 394.4 MW, and it is likely to increase in the coming years. Additionally, the solar photovoltaic installed capacity for Saudi Arabia in 2019 was 344.4 MW.
  • Saudi Arabia’s energy demand has been rising, with the consumption increasing by 60% in the last 10 years. The demand for electricity in 2019 is about 62.7 GW, and it is expected to increase to 120 GW in 2030.
  • Saudi Arabia has become one of the Middle East and North Africa (MENA) region’s leaders in the race to use renewable energy. As of January 2020, the value of solar power projects in the MENA region is estimated at between USD 5 billion and USD 7.5 billion. By 2024, this value is expected to reach USD 15 billion-USD 20 billion.
  • Upcoming solar projects include Madinah, Rafh, Qurayyat, Al-Faisaliah, Rabigh, Jeddah, Mahd Al-Dahab, Al-Rass, SAAD, and Wadi Ad-Dawasir, along with Layla and PIF.
  • In 2018, the ambitions of Saudi Arabia’s National Renewable Energy Program (NREP) were substantially increased with a 5-year target of 27.3 GW and a 12 years target of 58.7 GW, including 40 GW of PV and 2.7 GW of CSP.
  • Therefore, based on the above-mentioned projects, Saudi Arabia is expected to witness significant demand for distributed solar power generation in the Middle-East and Africa region over the forecast period.

Competitive Landscape

The market for distributed solar power generation in Middle-East and Africa is partially fragmented, with the presence of numerous players. Some of the major players in the market include Wuxi Suntech Power Co. Ltd., Canadian Solar Inc., Juwi Solar Inc., JinkoSolar Holding Co. Ltd, and Sharp Solar Energy Solutions Group.

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