Solar power set for expansion in the Gulf

Subject

Solar power in the Gulf.

Significance

Favourable natural conditions and growing gas shortages make the Gulf Cooperation Council bloc one of the most attractive and lowest-cost solar markets in the world.

Impacts

• Lower oil prices will reduce funding and incentives for solar projects, but recent reductions in costs make solar power economically viable.
• To win future bids, solar firms will require a combination of local knowledge and global best practice.
• The UAE and Saudi Arabia have strong prospects of evolving into a regional hub for solar business and installations.
• Due to low capacity and a small starting base solar power may displace only 1-3% of the power sector's fuel consumption by the early 2020s.
• Another barrier to growth will be the lack of coherent government policy frameworks, and ongoing electricity subsidies.