PHOTO
The Middle East is poised for large expansion in battery energy storage systems (BESS), driven by Saudi Arabia and the UAE, according to a report by S&P Global Ratings.
Saudi Arabia has a target of 48 gigawatt hours (GWh) of BESS by 2030 to keep grid stability amid significant growth in solar PV penetration.
Moreover, there have been over 30 GWh of tender requests for quotations since the start of 2024 in Saudi Arabia, the report said.
Large Chinese system suppliers with scale are likely to continue dominating the region as tender prices are driven lower and Chinese engineering procurement and construction companies solidify their position, Sofia Bensaid, Director - Infrastructure & Project Finance Ratings at S&P Global Ratings, wrote in the report.
As a result, the Middle East has benefited from the lowest energy storage system prices seen globally, excluding mainland China, she said.
According to the report, battery storage is rapidly becoming a central pillar of GCC energy strategies, enabling the reliable integration of intermittent solar and wind generation into the energy mix.
“Peak electricity demand in the region typically occurs in the evening, when solar production drops. This mismatch between the timing of generation and demand means that without flexible resources, renewables can’t deliver reliable power,” the report said.
S&P believes that addressing this challenge is now a priority for both policy and investment.
“We are seeing a strong push for BESS, not just as optional add-ons, but as enablers of energy security and grid flexibility in a low-carbon system,” the report said.
Momentum is building across the region, with projects scaling up and procurement pipelines expanding.
Battery storage is becoming critical to delivering reliable, round-the-clock, clean power, S&P said.
As renewables gain ground across the GCC, storage is increasingly shaping the design, financing, and operation of power systems.
Declining battery costs are further strengthening the investment case, the rating agency stated.
(Writing by P Deol; Editing by Anoop Menon)
Subscribe to our Projects' PULSE newsletter that brings you trustworthy news, updates and insights on project activities, developments, and partnerships across sectors in the Middle East and Africa.
