Saudi Arabia reached a significant historic step by completing financial closure for the first two solar power plants. One such facility is the Al Henakiyah-2 solar power plant in Madinah province. This plant commands an impressive capacity of 400 megawatts (MW). It’s an important piece to the puzzle as the Kingdom looks to increase its renewable energy share. Al Henakiyah-2 facility rests some 720 kilometers west of Riyadh. This facility is the first major step in Saudi Arabia’s goal of generating at least 50% of its electricity from renewable sources by 2030.
The Saudi Power Procurement Company, a state-owed utility, will build the projects according to 25-year power purchase agreements (PPAs). This commitment is a tremendous win for clean energy. The financial backing for these projects reflects growing investor confidence in Saudi Arabia’s renewable energy sector, supported by the Ministry of Energy’s National Renewable Energy Programme.
Commitment to Local Workforce
One interesting thing about these solar ventures is their deep, sincere commitment to the employment of Saudi nationals. For the first five years of operations, we will be dependent on local talent. Much of the workforce at both plants will be made up of local residents. This initiative doesn’t just passively provide support for job creation. In addition to expanding local industrial capacity, it seeks to increase the share of Saudi nationals in the workforce as the projects develop through the years.
This integration of local workforce participation underscores a national commitment to those goals and further strengthens and complements the Kingdom’s Vision 2030 goals. By injecting local employment capacities, these projects stimulate economic diversification and decrease economies’ dependence on expatriate labor.
Environmental Impact and Energy Supply
Together the two solar power plants are estimated to provide enough clean energy to serve more than 240,000 Saudi households each year. The federal government has promised to build by 2030. They are only expected to reduce carbon dioxide emissions by just under 3 million tonnes per year. This will greatly support Saudi Arabia’s decarbonization targets while strengthening its liquid displacement program.
Cédric Le Bousse, Executive Vice-President of EDF Power Solutions for Europe, Middle East, and Central Asia, emphasized the projects’ importance for the region.
“Reaching financial close on these two major solar projects represents a significant milestone and demonstrates the continued confidence of financial institutions in Saudi Arabia’s renewable energy sector. The Al Masa’a and Al Henakiyah-2 projects will further strengthen EDF power solutions’ position in the kingdom, bringing our total renewable capacity to over 3,500MW. These projects exemplify EDF Power Solutions’ long-term commitment to supporting Saudi Arabia’s Vision 2030 and the Saudi Green Initiative, as we work together to accelerate the kingdom’s energy transition and build a competitive and sustainable energy sector.” – Cédric Le Bousse, EDF Power Solutions
Timeline for Operations
The first new centralized solar plant will start commercial operation in Q1 2027. At the same time, the second facility is scheduled for completion and beginning of commercial operations by the third quarter of that year. This unbundled, phased approach is slowly starting to integrate new technologies into the energy grid. It provides more lead time for workforce training and development efforts.