Saudi Arabia Solar Energy Market Trends and Growth Forecast, 2026-2031 - Record-Low Tariff Auctions and Local Content Rules Enhance Solar Investment in Saudi Arabia
Dublin, Jan. 20, 2026 (GLOBE NEWSWIRE) -- The "Saudi Arabia Solar Energy - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2026-2031)" has been added to ResearchAndMarkets.com's offering.
The Saudi Arabia solar energy market is set to experience significant growth, with its size projected to reach 13.47 gigawatts (GW) in 2026, rising from 10.25 GW in 2025, and reaching an estimated 52.72 GW by 2031. This marks a remarkable compound annual growth rate (CAGR) of 31.40% from 2026 to 2031. The market's expansion is driven by the country's increasing demand for clean electricity, alongside the goals outlined in Vision 2030, which mandates substantial investments in renewable energy.
Underpinning this growth momentum is the streamlined Renewable Energy Project Development Office (REPDO) tender process, which effectively reduces development risks and financing costs for investors. These tenders have been instrumental in integrating battery storage capabilities and local-content thresholds within utility procurements, promoting alignment with climate objectives and industrial policy, while fostering domestic manufacturing. Saudi Arabia's advantageous solar irradiance and expansive desert terrain support some of the world's leading capacity factors, ensuring competitive pricing for solar energy projects.
Significant trends in the Saudi Arabian solar energy market include the Vision 2030 National Renewable Energy Program, which targets 58.7 GW of renewable energy by 2030. This target represents roughly half of the nation's forecasted installed capacity, propelling a transition from hydrocarbons to clean energy. REPDO's multi-round auctions have awarded over 3.3 GW of capacity at extremely competitive tariffs, making the program highly credible to potential investors. The predictability provided by REPDO significantly lowers capital costs and supports a reliable project pipeline, attracting global and regional developers. As a result, solar energy maintains an edge over conventional energy sources.
The decreasing levelized cost of electricity has created a grid parity advantage for the solar sector. Recent bids have seen prices drop to 1.67 cents per kilowatt-hour (c/kWh), significantly lower than natural gas estimates. This economic advantage is bolstered by local fabrication agreements with companies such as JinkoSolar and TCL Zhonghuan, eliminating import duties and freight expenses. Saudi Arabia's superior average irradiation further supports high capacity factors, maximizing energy output from fewer panels and enhancing project profitability.
While the market prospers, grid connection bottlenecks pose challenges for remote developments. Outdated transmission grids primarily cater to coastal gas-fired hubs, leaving northern desert regions underdeveloped. Although projects are budgeted for upgraded high-capacity lines and flexible converters, existing timelines outpace photovoltaic (PV) build schedules. Developers are concentrating on interconnection studies and strategically relocating projects closer to substations to optimize irradiation trade-offs. Until these grid corridors are improved, balancing resource quality with infrastructure readiness remains a key concern.
The market's segment analysis shows that solar photovoltaic installations commanded a 98.55% market share in 2025 due to cost advantages and modular scalability. Large-scale PV clusters continue to dominate, with falling module prices and standardized contracts pushing levelized costs below 2 c/kWh. Concentrated solar power (CSP) installations, although lesser in volume, are poised for substantial growth, anticipated to achieve a 44.3% CAGR from 2026 to 2031. CSP's capacity to provide dispatchable energy with thermal storage positions it as a crucial complement in maintaining grid stability.
Report Scope
This thorough Saudi Arabia Solar Energy Market Report evaluates market segments by technology, grid type, and end-user applications, offering forecasts in terms of installed capacity. Prominent companies covered in the report include ACWA Power Company, Alfanar Group, Abu Dhabi Future Energy Company, and more. The report also provides market estimates in Excel format and three months of analyst support to offer comprehensive insights into this burgeoning market.
Key Topics Covered
1 Introduction
1.1 Study Assumptions & Market Definition
1.2 Scope of the Study
2 Research Methodology
3 Executive Summary
4 Market Landscape
4.1 Market Overview
4.2 Market Drivers
4.3 Market Restraints
4.4 Supply-Chain Analysis
4.5 Regulatory Outlook
4.6 Technological Outlook
4.7 Porters Five Forces
4.8 PESTLE Analysis
5 Market Size & Growth Forecasts
5.1 By Technology
5.2 By Grid Type
5.3 By End-User
5.4 By Component (Qualitative Analysis)
6 Competitive Landscape
6.1 Market Concentration
6.2 Strategic Moves (M&A, Partnerships, PPAs)
6.3 Market Share Analysis
6.4 Company Profiles
7 Market Opportunities & Future Outlook
7.1 White-space & Unmet-need Assessment
A selection of companies mentioned in this report includes, but is not limited to:
For more information about this report visit https://www.researchandmarkets.com/r/jledbz
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