Chinese Companies Make Strong Push into Saudi Arabia’s Sustainable Energy Sector

Recently, leading Chinese photovoltaic mounting company, Arctech, announced that it has signed a cooperation agreement with China Energy International Engineering to provide a 1.5 GW SkySmart II tracking system for the ASB project in Saudi Arabia.

This marks Arctech’s first photovoltaic mounting project in Saudi Arabia. Previously, Arctech has undertaken several projects in Oman and Abu Dhabi, UAE, and has set up branches in Saudi Arabia and the UAE.

The ASB project is located in the Al Shuqaiq region of Jeddah, Mecca Province, with a total installed capacity of 2.6 GW. It is currently the largest single photovoltaic station project under construction in the Middle East.

The project is jointly undertaken by China Energy International Engineering, Guangdong Thermal Power, and Northwest Institute, and officially started construction on November 13, 2022, with ACWA Power as the project owner.

ACWA Power is a Saudi operator in the fields of power generation, renewable energy, desalination, and green hydrogen. China Energy International Engineering has previously cooperated with ACWA Power on several projects. On October 18, 2022, the two parties signed contracts for the Saudi PIF Phase II 2.6 GW photovoltaic project and the Uzbekistan Bukhara 2*500 MW wind power project.

The ASB project is an essential part of Saudi Arabia’s “Vision 2030” sustainable energy plan. In 2016, the Saudi Crown Prince proposed “Vision 2030,” aiming to develop sustainable energy sources such as solar and nuclear power, with the goal of transitioning from an “oil nation” to an “energy-producing country.”

Saudi Arabia’s development strategy plan indicates that renewable energy will account for 50% of the country’s energy structure by 2030. Saudi Arabia aims to achieve an installed capacity of 27.3 GW of renewable energy by 2023 and 58.7 GW by 2030.

On January 30, Saudi Arabian state television reported that the country’s Energy Minister stated that the country plans to invest SAR 1 trillion (approximately CNY 1.8 trillion) in clean energy production.

As of now, several Chinese companies have already engaged in cooperation in the sustainable energy sector with Saudi Arabia.

In December 2022, the first China-Arab Summit was held in Riyadh, the capital of Saudi Arabia, highlighting the broad prospects for cooperation between China and Arab countries in climate change and energy transformation. During the summit, the Saudi Minister of Investment, Khalid Al-Falih, revealed that investment agreements totaling USD 50 billion were signed.

Companies including China General Nuclear Power Corporation, China State Power Investment, Sungrow Power Supply, Jinko Solar, China Southern Power Grid, and the Silk Road Fund have signed relevant cooperation agreements with Saudi Arabia.

On December 7, China General Nuclear Power Corporation signed a framework cooperation agreement with A1Jomaih Group to jointly build over 10 GW of energy projects in Saudi Arabia, Laos, Bangladesh, Azerbaijan, and other countries. A1Jomaih Group is a well-known Saudi company covering consumption, commerce, industry, and other fields.

During the summit, Sungrow Power Supply and ACWA Power signed a memorandum of understanding, with Sungrow providing a 536 MW/600 MWh energy storage system for the Saudi Neom project. Jinko Solar also signed a memorandum of understanding with ACWA Power to provide 4 GW of Tiger Neo modules for project development.

The Silk Road Fund signed a cooperation memorandum of understanding with ACWA Power to seek collaboration in the renewable energy, desalination, and green hydrogen fields. China Southern Power Grid signed a framework cooperation agreement with ACWA Power for clean energy development and other areas of collaboration.

Additionally, the Huanghe Company under China State Power Investment exchanged a memorandum of understanding with ACWA Power. In 2019, the two parties signed a memorandum of strategic cooperation in renewable energy. In 2021, Huanghe Company became the first Chinese state-owned power investment enterprise to participate in Saudi Arabian photovoltaic bidding and win a project.

Earlier, Huawei, LONGi Green Energy Technology, Jinko Power Technology, Trina Solar, and other companies have also entered the Saudi market in the sustainable energy sector.

In 2018, Huawei won the first utility-scale solar photovoltaic project in Saudi Arabia. In October 2021, Huawei signed the contract for the then-largest 1,300 MWh energy storage project at the Saudi Neom project during the Global Digital Energy Summit held in Dubai.

LONGi Green Energy Technology previously participated in the Neom 406 MW photovoltaic project, mainly providing photovoltaic components for the project. In 2023, LONGi Green Energy Technology will continue to supply photovoltaic components for the Sudair 1800 MW project.

In February 2022, Jinko Power Technology announced its plan to invest USD 209 million to build a 300 MW photovoltaic power generation project in Saudi Arabia. In January of this year, Jinko Power Technology announced that it won a contract to develop a 300 MW Sad Independent Power Producer photovoltaic solar project in the third round of Saudi Arabia’s National Renewable Energy Program (NREP).

Trina Solar’s products have also been sold to the Saudi market. In April 2022, 44 MW of Trina Solar’s “210mm N-type 690W” series modules were shipped to Jubaile 3A Seawater Desalination Project in Saudi Arabia.

On March 7, 2023, the Saudi Shura Council approved the draft memorandum of understanding between the Saudi Ministry of Energy and the Chinese National Energy Administration in the field of clean hydrogen energy, indicating that China and Saudi Arabia are expected to deepen their cooperation in the energy sector.