Major renewable energy projects are the cornerstone of the Saudi Arabia Renewable Energy Market, demonstrating the Kingdom's commitment to achieving its Vision 2030 targets and establishing itself as a renewable energy leader. According to Market Research Future, the Saudi Arabia Renewable Energy Market projects segment is experiencing significant growth, with the overall market projected to reach USD 66.59 billion by 2035, growing at a CAGR of 7.36% from its 2024 valuation of USD 30.48 billion. The scale and ambition of Saudi Arabia's renewable energy projects are unprecedented, with billions of dollars invested in solar, wind, and green hydrogen initiatives.
Solar Mega-Projects
Solar projects represent the largest share of Saudi Arabia's renewable energy portfolio. The Sudair Solar PV project, located north of Riyadh, exemplifies the scale of Saudi solar ambition at 1.5 gigawatts (GW), one of the largest single-site solar installations in the world . The Al Shuaibah 2 solar farm, with a capacity of more than 2 gigawatts, is Saudi Arabia's largest solar farm, enough to power around 350,000 homes . In Q3 2025, Saudi Arabia signed power purchase agreements for seven new solar and wind projects totaling 15,000 MW, with investments exceeding SAR 31 billion (approx. USD 8.3 billion) . The solar projects include the 3 GW Bisha project in the Aseer region with an agreed levelized cost of electricity (LCOE) of SAR 0.0484 ($0.0129)/kWh, the 3 GW Humaji project in the western Madinah region, the 2 GW Khulis project in the western Makkah region, and the Afif 1 and Afif 2 projects in the Riyadh region . The five solar PPAs alone represent 12 GW of new capacity . Scheduled to be operational across the second half of 2027 and the first half of 2028, these projects will significantly boost the Kingdom's renewable energy capacity .
Wind Energy Projects
Wind energy projects are playing an increasingly important role in Saudi Arabia's renewable energy portfolio. The Dumat Al-Jandal wind farm, located in the Al Jouf region of northern Saudi Arabia, is the Middle East's largest wind installation at 400 megawatts . The Dawadmi wind project achieved a levelised tariff of $0.0133 per kilowatt-hour, described as a global benchmark for wind power generation costs . In the 2025 procurement round, wind projects included the 2,000MW Starah wind power project, the 1,500MW Dawadmi wind power project, the 1,000MW Shaqra wind power project, and the 700MW Yanbu wind power project . These projects are being developed across the Kingdom, with the wind resource strongest in the northern regions and along the Red Sea coast .
The NEOM Green Hydrogen Project
The NEOM Green Hydrogen Project represents arguably the most strategically significant renewable energy initiative in the Kingdom . A joint venture between ACWA Power, Air Products, and NEOM, the $8.4 billion project will produce green hydrogen using dedicated solar and wind power, water electrolysis, and nitrogen from an air separation unit to synthesise green ammonia for export . At planned capacity, the project will produce 600 tonnes of green hydrogen per day and 1.2 million tonnes of green ammonia per year . The ammonia serves as a hydrogen carrier, enabling transport to international markets where it can be used as a clean fuel for shipping, power generation, and industrial processes, or reconverted to hydrogen . The project positions Saudi Arabia as a first-mover in the green hydrogen export market .
Hybrid and Distributed Projects
Hybrid and distributed renewable energy projects are also being developed across the Kingdom. Saudi Arabia-based Lamar Holding has signed a contract to develop a hybrid power plant at the Empty Quarter (Rub Al-Khali) land port . The public-private partnership project aims to reduce diesel fuel use with renewable energy and includes the construction of 15MW of total hybrid installed capacity, installation of a 7 megawatt-peak solar photovoltaic system, and eight 1MW internal combustion engines . The proposed plant will have the capacity to produce 25 gigawatt-hours of electricity annually . These smaller-scale projects demonstrate the Kingdom's commitment to integrating renewable energy across diverse applications.
Project Procurement and Development
The pace of project procurement and development in Saudi Arabia has been breathtaking . Saudi Arabia signed 15 power purchase agreements (PPAs) in 2025, contracting a combined generation capacity of 24.389 gigawatts (GW) . The Saudi Power Procurement Company, a subsidiary of the Saudi Electricity Company, has launched over 43 GW of renewable electricity generation projects since its inception, with PPAs in place for over 38 GW of capacity and over 10 GW already connected to the grid . Capacity connected to the grid is expected to reach 12.7 GW by the end of 2025 and surpass 20 GW by the end of next year . The financial close of the seven major projects signed in 2025 is expected by the third quarter of this year .
Investment and Financing
Significant investment is flowing into Saudi Arabia's renewable energy projects. The Saudi government has committed over $50 billion to renewable energy projects as part of its Vision 2030 plan . ACWA Power and other developers are investing billions in project development, with the company involved in several renewable energy projects, such as the Shuaibah Solar Plant . The Red Sea project aims to develop a 500 MW storage facility alongside solar and wind power plants . Private sector involvement in the Saudi Arabia renewable energy market is growing rapidly, led by local and foreign companies through initiating and developing renewable energy projects .
Project Economics and Competitive Tariffs
The economic competitiveness of Saudi Arabia's renewable energy projects is demonstrated by record-low tariffs. The Dawadmi wind project achieved a levelised tariff of $0.0133 per kilowatt-hour . The Bisha solar project achieved an agreed LCOE of SAR 0.0484 ($0.0129)/kWh . The Afif 1 and Afif 2 projects achieved an agreed LCOE of SAR 0.047/kWh . These competitive tariffs reflect both the quality of Saudi Arabia's renewable resources and the competitive intensity of the procurement process . The success of the procurement program in achieving low tariffs has attracted international developers and investors .
Grid Integration and Infrastructure
Grid integration and infrastructure development are essential for project success. Saudi Arabia is investing heavily in infrastructure, with over $100 billion allocated for energy-related projects, including the construction of new power plants, transmission lines, and smart grid technologies . The expansion of infrastructure is essential to support the increasing energy demand and facilitate the integration of renewable energy sources into the national grid, ensuring a reliable and efficient energy supply for the future . The Saudi Electricity Company (SEC) is upgrading the national grid to accommodate distributed renewable generation, improve interconnection capacity, and implement smart grid technologies .
Future Project Pipeline
The future project pipeline for Saudi Arabia's renewable energy sector is substantial. The Kingdom is targeting renewables to account for 50% of the electricity generation mix by 2030, as it accelerates investment in large-scale clean energy infrastructure . Rystad projects more than 70 GW of solar will be installed by the end of the decade . The Kingdom aims to become a worldwide leader in solar energy, and its projects like NEOM and King Salman Park engage with solar technology while trying to include it in its sustainable urban design efforts . The project pipeline offers opportunities across the value chain from project development to equipment supply to grid services .
Conclusion
The Saudi Arabia Renewable Energy Market continues to evolve with major projects representing the cornerstone of the Kingdom's renewable energy strategy, demonstrating unprecedented scale and ambition. By 2035, the market is projected to achieve substantial growth, with Saudi Arabia positioned as a leader in renewable energy development, green hydrogen production, and sustainable energy innovation.
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