Saudi Arabia Sets Record-Low Prices for Wind Power Projects
Saudi Arabia has signed two groundbreaking agreements to purchase electricity from wind farms at record-low prices, furthering its renewable energy ambitions. The Saudi Power Procurement Company (SPPC) and a consortium led by Japan’s Marubeni Corporation concluded these deals during the Saudi-Japan Vision 2030 Business Forum in Japan.
Key Projects
Wa’ad Alshamal Wind Farm:
- Capacity: 500 MW
- Cost: 1.70187 US cents per kWh
AlGhat Wind Farm:
- Capacity: 600 MW
- Cost: 1.56558 US cents per kWh (world record low for wind power)
- Completion: Expected by 2026
The 600 MW AlGhat Wind Farm will produce power at a world-record low cost of 1.56558 US cents per kWh, as reported by the Saudi Press Agency, citing Energy Minister Prince Abdulaziz bin Salman. The 500 MW Wa’ad Alshamal Wind Farm will supply electricity at 1.70187 US cents per kWh, achieving the second lowest cost for wind power globally.
These projects are part of Saudi Arabia’s National Renewable Energy Program (NREP), which aims to achieve a 50% share of renewable energy in the country’s electricity mix by 2030. This initiative supports the broader Vision 2030 plan to diversify the economy and promote sustainable development.
Energy Minister Prince Abdulaziz bin Salman highlighted that the energy produced annually from both projects will be sufficient to power 257,000 residential units. This underscores the significance of these projects in enhancing energy consumption efficiency in the Kingdom.
Saudi Arabia also holds the world record for the lowest-cost solar power, with the Shuaibah 1 solar project (600 MW) producing electricity at just 1.04 US cents per kWh. While the country is renowned for its abundant solar resources, it also boasts significant wind energy potential, evidenced by a competitive selection in 2019 that recorded a price of 2.13 US cents per kWh.
These agreements secure wind power at prices lower than traditional fossil fuel-based electricity, aiding in the reduction of greenhouse gas emissions and decreasing liquid fuel consumption in the energy sector. Saudi Arabia’s success in both wind and solar energy demonstrates the cost-effectiveness of renewables, setting new global benchmarks. The kingdom’s commitment to transitioning to greener energy sources underscores its leadership in establishing new standards for low-cost renewable energy.
