The implementation of the world’s largest battery energy system (BESS) project progresses as Saudi Arabia begins qualification tenders. A Saudi Arabian entity that has been tasked with procuring electricity generation projects has commenced the process. Saudi Power Procurement Company (SPPC) is licensed as the sole buyer of electrical energy. The government entity is soliciting bids for the development of four battery energy storage system (BESS) projects. Furthermore, it is expected that each will have a 500MW output and 2,000MWh in storage capacity. The contract which entails 15-year terms will be awarded on a build-own-operate (BOO) model. It also entails the aspect of bidders holding 100% equity in special purpose vehicle (SPV) companies set up for the development and operation of projects. The SPPC, administered by the Saudi Ministry of Energy, aligns with the National Renewable Energy Program (NREP). Once completed, the BESS project is expected to be the world’s largest.
The State of Affairs Regarding the World’s Largest BESS Project in Saudi Arabia
The world’s largest BESS project in Saudi Arabia is one that has received accolades from the state government. Under Saudi Arabia’s Vision 2030 policy roadmap, the country aims to have a 50% share of renewable energy in its grid. According to energy minister, Prince Abulaziz bin Abdullah Al Saud, the government is prepared to incur the needed costs. Speaking in 2021, the Saudi government expects to spend $293 billion on power and energy projects by then. The biggest share of this revenue is expected to be spent on transmission upgrades and renewable energy.
Furthermore, investment is expected to be placed in the distribution network. SPPC noted earlier this week that the newly launched BESS procurement project will help the nation reach its 50% goal. The company also noted that the current tenders represent the first batches of solicitations. The locations of the four BESS facilities have already been decided. Two will be in Makkah province, one in Qassim province, and the other in Hail province. They have also been termed as independent storage projects (ISPs) by SPPC. Qualified bidders have been issued until midday, 25 November 2024, to submit their proposals for the BESS project.
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Saudi Arabia on Track to Ensure Its Net Zero Energy Ambitions Are Fulfilled
The Kingdom of Saudi Arabia is making significant strides through this monumental project to ensure it achieves its net-zero target. The world’s largest BESS project in the region shows that the nation is determined to achieve this endeavor. Last week, Prince Abdulaziz revealed that the Kingdom is seeking to establish significant battery energy storage capacity. It is part of the plan to strengthen and expand its electricity infrastructure. It also reduces the nation’s reliance on fossil fuels. “We have already signed 26GWh of batteries and by 2030, we will be doing 48GWh,” he said. His remarks were appreciated by many as he spoke at the Future Investment Initiative (FII8) in Riyadh. He also noted that the project was being carried out under the Public-Private Partnership model, setting a timeline for 2030 to achieve the expected storage capacity output.
