BIG PLANS FOR BIG SOLAR IN SAUDI ARABIA
Saudi Arabia CSP Plan Review
Jenny Muirhead, March 4, 2013 (CSP Today)
“…[Saudi Arabia] has an objective of 25GW of operational CSP before 2032. Many solar professionals have been waiting…for the Saudi tender to come out…[especially because] the industry has been experiencing difficulties in the traditional markets of Spain and USA…[and] India and South Africa have recently delayed their next bidding rounds.
“The basis of the [comprehensive Saudi] tendering process, released by King Abdullah City for Atomic and Renewable Energy (K.A. CARE), is…modeled to learn from previous experience in other countries…[It] will start with an introductory round of 900MW of CSP (vs 1100MW of PV)…[T]he next round will be 1200MW (1300MW of PV)…K.A. CARE…[is planning a new round each year]…[This sounds optimistic because of] time-consuming project development issues such as securing land…in close proximity to grid connection…Local content is likely to be one of the stickiest points…There are also several 1% of income ‘obligations’…”
“…[All projects] will have a minimum capacity of 5MW…The local content [requirement] in the introductory round is…50% and higher…and rises to 60% and 70% in successive rounds [with non-compliance penalties]…The minimum requirement for thermal storage is 4 hours…All other things been equal, K.A. CARE will pick the project with the longest storage…The [non-negotiable PPA will] be 20 years…[and a one year connection delay will reduce the PPA to 17 years], carrying heavy financial consequences…
“…[The 1% of income penalties] will be used for… training…R+D…[and] a Sustainable Energy Research Fund (SERF)…[A] human resources (HR) report of the project…[detaling] the number of Saudi workers, foreign workers and salaries [will be required]…[The lowest 20% will be penalized] 40,000 Riyal (about US$10,600) for each non-Saudi employee…[D]evelopers in the top 5% of the ranking may [get] 40,000 Riyals…[Developers must do] DNI resource studies…[and demonstrate] enough financial leverage]…[T]his opportunity is likely to be found in partnerships with key international and Saudi energy giants – particularly oil companies…”
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