Renewables developers eyeing Saudi Arabia remain wary of the market following the news that the world’s biggest solar project has been canceled.
The $200 billion, 200-gigawatt solar plant planned by SoftBank and the Saudi Public Investment Fund had raised skepticism among developers when it was announced in March, partly because of technical concerns over how it might be integrated into the grid.
The main worry, though, was that the megaproject appeared to have been approved independently of plans for an orderly ramp-up of solar through a tender program managed by the Saudi Renewable Energy Project Development Office (REPDO).
Soon after the SoftBank agreement was unveiled, it emerged that top officials in the kingdom had been excluded from negotiations, adding further uncertainty.
Given the haphazard way in which the deal was brokered — and the fact that the Saudi state and SoftBank had both previously announced plans for massive solar investments that had been canceled — last week’s news came as no surprise.
“Precedent would suggest that grand solar plans from SoftBank or the Saudi state come with a gap between promises and reality,” said Benjamin Attia, global solar analyst with Wood Mackenzie Power & Renewables. “This is no exception.”
He said the project never got beyond an initial feasibility study.
According to The Wall Street Journal, the announcement of the freeze was greeted with relief by Saudi energy officials. “Everyone is just hoping this whole idea would just die,” one said.
Although the SoftBank project was widely viewed as being doomed from the start, the cancellation is a further blow to the Saudi solar market.
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