Renewable energy is now the most competitive form of power generation in the Gulf Cooperation Council (GCC) region, according to the International Renewable Energy Agency (IRENA).
In a new report, IRENA says that the region’s abundant energy resources as well strong enabling frameworks have helped to drive down the cost of solar photovoltaics (PV) and concentrated solar power (CSP). The region is also among the most attractive regions in the world to develop wind energy, it says.
In the report, ‘Renewable Energy Market Analysis: GCC 2019’, solar PV prices of ¢3/kWh can be achieved, as well as CSP prices of ¢7.3/kWh. These prices are lower than some utilities in the region pay for natural gas, IRENA notes.
“The GCC is among the most attractive regions in the world to develop large-scale solar and wind energy projects as a result of resource abundance and a favourable policy environment, a fact that is backed up by record low prices,” said IRENA Director-General, Adnan Z. Amin. “As a fossil-fuel exporting region, the GCC’s decisive move towards a renewable energy future is a signal to global investors and to the energy community that we are experiencing a step-change in global energy dynamics and a true energy transformation.”
At the end of 2017, the region had some 146 GW of installed power capacity, of which renewable energy accounted for 867 MW. Around 68 per cent this capacity was in the UAE. This represents a four-fold increase on capacity in 2014. Following the UAE are Saudi Arabia with 16 per cent and Kuwait with nine per cent of regional capacity.
With renewable energy targets now in place across the region, the GCC is poised for a significant acceleration in renewables deployment as countries pursue national goals, according to IRENA. Under current plans, the region will install a total of almost 7 GW new power generation capacity from renewable sources by the early 2020s.
Solar PV dominates the region’s renewables outlook, accounting for three-quarters of the regional project pipeline, while CSP and wind account for 10 per cent and nine per cent respectively. Solar-assisted enhanced oil recovery in Oman is also expected to contribute about 1 GWth in 2019.