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 5.9 Manufacturing 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 600 850 200 600 70 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 localization target Nacelle 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