Saudi Arabia National Renewable Energy Program

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Saudi Arabia National Renewable Energy Program Saudi Arabia National Renewable 1 Energy Program Saudi Arabia significantly increased its renewable energy targets and long term visibility Planned Capacity (GW) 5-Year Target 12-Year Target 58.7 Increased 2.7 CSP 5-Year Target 16.0 Wind Extended visibility 2 to 2030 27.3 7.0 Optimized 40.0 Solar PV the energy mix 9.5 20.0 2.4 Manufacturing 5.9 capacity of 200GW by Initial Revised 2030 Target 2030 12 pre-developed projects will be tendered in 2019 with a total capacity of ~3.1 GW Qurrayat Alfaisalia Saad Wadi Adwawser Yanbu TOTAL 200 600 600 70 850 Madinah Rabigh Alras Qurrayat 50 300 300 40 3 2,225 Rafha Jeddah 45 300 Mahad Dahab 850 20 Projects will be deployed in 35+ parks spread across the Kingdom Waad Al Shammal Qurayyat Tabarjal Rafha 35+ parks Sakaka North Tabuk Al Kahafah to be developed by 2030 Tabuk Midyan Qaisumah Al Masa'a Sourah Al Ghat Unaizah Sudair Spread across Al-Ula Ar Rass Shaqra Malham 4 Henakiyah Dhurma Ghilanah the Kingdom to promote Yanbu Khushaybi Tuwaiq Riyadh Al Haeer South Yanbu Madinah AlQuwaiiyah regional development Mastoorah Mahd Aldhab Duwadimi Rabigh Dhahban Starah Al-Kharj South Jeddah Al Faisaliah Haden Layla Al Laith Gradual deployment Bisha Wadi Ad Dawasir to mitigate technology risk Jazan Solar PV Farasan Sharorah Wind CSP What is Pre-Development? Site Selection Pre-development activities provide certainty and deliver lower project costs Energy Yield Grid Impact Assessment Studies Preliminary Pree-- Secure Design Input to tender DDeveellooppmmenetn Land 5 t AAccttivivitiiteises Reduced risk Successful IPP Hydrological Measure Assessment Resource Lower LCoE Geotech. Environmental Assessment Assessment Framework for Developing Tendering Policies Qualification RFP Evaluation Award 6 • Technical and • Local Content • Public bid • Short listing and financial criteria requirements announcements than award. No • Prescriptive technical • RFP compliance and alternative bids parameters of the than lowest LCOEE or negotiations plants (location, size, technology) • Bank Guarantees, EPC term sheets, O&M term sheets, financial model Saudi Arabia Localization Objectives Global Local Content Benchmarks Bubble size - Installed Renewable Energy Capacity (GW): <10 GW 10-100 GW >100 GW MEIM and PIF are working on complementary tracks to promote localization of manufacturing Development Allocated Pipeline Track Objectives Approach (% of RE Capacity) • Enable price discovery Tendered • Competitive tender • Attract private investments by REPDO 30% 9 • Increasing local content • Promote market innovation requirements • Negotiated deal with international • Fast-track localization Awarded partner for project development • Target exports of RE equipment to PIF • Captive offtake from large scale 70% manufacturing (200 GW) • Develop Giga-scale projects What Do We Want from Local Content High Short-term Technology: Inverter Nacelle localization target Assembly Assembly Wind Tower Solar Hub Assembly GDP Impact: Rotor Medium-term Blades 10 Long term cost localization target 50 Mn SAR / GW competitiveness Module Long-term localization target Cells Nacelle Polysilicon Housing Nacelle Electrical** Drivetrain Wafer Drivetrain Others* Gearbox Low Low Ease of Localization High Notes: *) Rotor Bearings, Break System, and Main Shaft; **) Power Converter, Transformers, and Fiber-optic Cables What Do We Want from Local Content Competitive and Sustainable Industry Value Localization Strategy Approach • Promote Factory localization • Expect Development of Supply Chain $15.000 Assembling Nacelle in the Country 11 $120.000 Main System Level (Generator, Gearbox, Transformer…) $300.000 Main Subsystem Level Level (Rotor, Stator…) $15.000 Subassembly Level $1.500.00 Individual Component Level (Bolts & Nuts) Captured Value Pyramid Local Content Roadmap Short Term (2017) Medium Term (2018-2019) Long Term (2020 onwards) LCOE Baseline Local Content Buildup Global Competitiveness Tendering guidelines & Tenders designed to Tenders support set up processes established drive local content of export capabilities 12 Introductory Aggressive capacity Stable development to capacity of 700 MW scale-up install 2030 targets Established LCOE Balanced LCOE and Balanced LCOE and price baseline Local Content Local Content Kick-start RE supply Setup of solar and wind Sustainable and export chain development industrial clusters oriented RE supply chain Localization Localization Localization 30% 40% - 60% 60%+ SAK & DAJ Source: Team Analysis .
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