The increasing environmental concerns and strong government initiatives, advancements in technology and design are making solar PV systems more reliable, efficient, and cost-effective, driving the growth of Solar Photovoltaic (PV) Commercial and Industrial Distributed Generation Market. Furthermore, distributed solar PV systems increase energy security by providing backup power during outages and reducing the risk of grid disruptions which helps in market expansion. Saudi Arabia is a rapidly growing market for solar PVs in Middle East region. Middle East solar PV market was estimated at USD 2.66 Bn in 2022 and is expected to grow to USD 17.32 Bn in 2030 growing at a CAGR of 30.69% during the forecast period.
Additionally, solar PV helps commercial and industrial players in lowering their energy costs and making long-term financial savings in the long run as solar energy is becoming increasingly cost-competitive and efficient. Also, by adopting solar options, companies can demonstrate their commitment to sustainability and environmental stewardship, which can help build their brand and enhance their reputation among customers and stakeholders. Furthermore, the adoption of solar energy provides energy independence to industry owners, reducing reliance on traditional power sources.
Rising Environmental Concerns Contributes to Market Growth
Saudi Arabia is a signatory to the Paris Agreement and has committed to reducing its carbon emissions, due to which the nation focus on environmental concerns. Developing its solar PV industry is one way the country is aiming to reduce its carbon footprint and meet its climate targets. Moreover, by growing its renewable energy industry, Saudi Arabia focus on enhancing its energy security and reducing its vulnerability to supply disruptions and price volatility in the global oil market.
Government Initiatives Propelled the Market Growth
According to the Ministry of Industry and Natural Resources, Saudi Arabia has launched a new programme to support renewable energy projects and reduce its reliance on crude oil. Moreover, the Ministry would provide tax breaks and other incentives to businesses that create renewable energy.
The Kingdom of Saudi Arabia plans to produce 50 percent of its electricity from renewable sources by 2030. In March 2022, a power purchase agreement (PPA) was signed by ACWA Power and the Saudi Power Procurement Corporation (SPPC) to build the 700 MW Ar Rass solar PV independent power plant (IPP) in the Al Qassim area of Saudi Arabia.
Impact of COVID-19
The COVID-19 outbreak caused the government to enact strict lockdown measures, which led to the temporary shutdown of several solar PV production facilities. The pandemic has caused supply chain disruptions which led to delays in the construction of solar PV systems, hence negatively impacting the growth. Additionally, the market faced economic crisis which resulted in a slowdown in project development and growth.
Impact of Russia-Ukraine War
Russia is one of the top oil producers in the world, thus disruptions in Russian oil shipments have caused an increase in oil prices. This has turned out to be advantageous for Saudi Arabia, as the Saudi Arabia is a significant oil producer too. However, the cost of electricity production from conventional sources is expected to increase, thereby making solar power a better choice for commercial and industrial sectors. Furthermore, the war has led to disruptions in the supply of natural gas to Europe, which may increase the demand for other sources of energy, including solar power. This could create opportunities for Saudi Arabia’s solar industry to expand its market share in Europe.
Report Scope
“Saudi Arabia Solar PV Commercial and Industrial Distributed Generation Market Assessment, Opportunities, and Forecast, 2016-2030F”, is a comprehensive report by Markets and Data, providing in-depth analysis and assessment of the current scenario of the solar PV commercial and industrial distributed generation market in Saudi Arabia, industry dynamics and challenges. The report includes market size, segmental shares, growth trends, COVID-19 and Russia-Ukraine war impact, opportunities, and forecasts (2023-2030). Additionally, the report profiles the leading players in the industry mentioning their respective market share, business model, competitive intelligence, etc.
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