MENA solar prices will continue to decline

Solar power prices are estimated to stay under $0.02.

The Middle East and North Africa (MENA) region will continue its downward trend with record-low solar tender prices, with the cost expected to remain below $0.02.

Several milestones of low solar tender prices include the lowest renewable power purchase agreement prices globally with AED4.97/kWh ($1.35/kWh) for a 2GW solar project in Abu Dhabi last 2020, a record-low price with $0.0104/kWh for a 600 MW project in Saudi Arabia.

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The low solar prices represented a significant shift towards more viable solar projects and solar production, making it among the lowest globally.

However, electricity prices over MENA remain subsidised, putting a risk to solar power projects. Factors like lower solar equipment costs, available land allocation and competitive solar contracts would be critical to drive solar energy and respective projects in the region.

According to the International Renewable Energy Agency (IREA), solar power production in MENA accounts for one-fifth of the global average.