Recently, Riyadh, the capital of Saudi Arabia, has ushered in an important moment of energy transition. Saudi Electricity Procurement Company has officially signed the first batch of four battery energy storage project agreements, with a total investment of over 1.16 billion US dollars and a total installed capacity of 2GW/8GWh. Under the witness of Prince Abdulaziz, Minister of Energy, the Saudi Energy Consortium led by ACWA Power has won three projects, while the French Engie Consortium has won one project. Saudi Arabia is making great strides from being an oil and gas giant to a clean energy system driven by both renewable energy and energy storage infrastructure.

Signing of 2GW energy storage contract

Saudi Electricity Procurement Company signed the first batch of four battery energy storage project energy storage service agreements, with a total investment of over 4.35 billion Saudi riyals, approximately 1.16 billion US dollars. All four projects are developed using the Build Own Operate (BOO) model, with each project having an installed capacity of 500MW and an energy storage duration of 4 hours, resulting in a total capacity of 2GW/8GWh. These projects are supervised and implemented by the Saudi Ministry of Energy, aiming to enhance grid reliability and power generation efficiency, and support the goal of 50% renewable energy by 2030.

Two major consortia receive separate projects

The three 500MW energy storage projects located in Muwiyah, Haden, and Kahafa in Mecca Province have been awarded to a consortium consisting of Saudi Energy Company, ACWA Power, and Al Sharif Contracted Commercial Development Company, with a total contract amount of approximately 3.25 billion Saudi riyals. ACWA Power holds 34.9% of the shares in each project company. The Hushabi 500MW energy storage project located in the province of Gaisim has been awarded to a consortium of French Engie and Haji Abdullah Al Reza, which will bring approximately $220 million in direct investment to Engie. Keywords: Middle East news and information, energy storage, new energy

Accelerate the implementation of energy storage infrastructure

This is the first batch of battery energy storage projects developed in Saudi Arabia using the BOO model, with each energy storage service agreement lasting 15 years from the date of commercial operation of the project. After the project is completed, it will store electricity for up to 4 hours and deliver it to the grid when needed, supporting grid stability, improving operational flexibility, and enhancing power supply safety. The Saudi Vision 2030 clearly states that by 2030, renewable energy generation will account for 50%, and the signing of four energy storage projects is a crucial step for Saudi Arabia to achieve this goal. The second batch of independent energy storage projects with a total scale of 3GW/12GWh has started pre qualification in July 2026, with 27 companies shortlisted and 7 Chinese companies receiving admission tickets. Energy storage infrastructure is transitioning from scattered demonstrations to a new stage of national level batch standardization development.Editor/Gao Xue