Saudi Arabia is set to offer some of the lowest low levelized cost of energy (LCOE), with solar power price levels more than four times less than in 2009, according to an expert.
Thierry Lepercq, founder and president of France-based Solairedirect, a leader in the development of large photovoltaic power plants, said that solar power costs have fallen dramatically over the last five years, due to lower module prices, lower balance of system costs, and increased competition at the development and EPC level.
The financing costs have also decreased as investors recognize the low-risk profile of solar assets, as a result of which solar power is now cheaper than most alternative power sources, he said.
"For systems with the right economies of scale – 10 MegaWatt (MW) and above – solar power can now be generated at between $70 and $100/MWh," said Lepercq.
Lepercq will explore that business case for utility-scale solar plants at the second edition of Desert Solar Saudi Arabia conference, which will take place on September 17 and 18 at the Sheraton Riyadh Hotel & Towers.
It will host more than 150 decision makers from across the industry and stakeholders in the Saudi Arabian solar energy market.
The panel of speakers will include executives from Air Liquide Mena, E.ON, King Abdullah University of Science & Technology (Kaust), and Tokyo Electron Taiwan, as well as Skypower Fas Energy, Solairedirect and First Solar.
"Today in Saudi Arabia, it is possible to reach a solar LCOE of between $70/MWh in the higher irradiation/elevation areas in the western part of the kingdom, and around $90/MWh in the Gulf area," revealed Lepercq.
"Recent developments in Saudi Arabia, such as the interest of local investors in financing PV projects and the growing amount of traction that EPC companies are gaining, are a clear indication of the Kingdom's potential to evolve into a sustainable solar energy market," said Dr Raed Bkayrat, vice president for Saudi Arabia at First Solar, a leading global solar energy solutions provider with over 9 gigawatts (GW) installed worldwide.
"With access to all the critical elements – low-cost finance, land availability, high solar irradiance and locally-based, skilled resources – there is no reason why Saudi Arabia cannot achieve some of the lowest PV levelized costs of electricity in the region," highlighted Dr Bkayrat.
The cost reductions can be expected as all cost factors continue to improve, down to $50-$70/MWh by 2020, according to Lepercq.