KSA Solar Energy Tracking Market Outlook to 2030

KSA Solar Energy Tracking Market Overview

• The KSA Solar Energy Tracking market is valued at USD 336 million based on a five-year historical analysis, driven by the Kingdom's focus on renewable energy under Saudi Vision 2030. The governments ambitious target to generate 58.7 GW of renewable energy by 2030 is a key driver, along with technological advancements in solar trackers, which optimize energy efficiency by aligning panels with the suns position. The market's growth is supported by an increasing demand for energy diversification and sustainability.
• In Saudi Arabia, the central and eastern regions dominate the solar energy market due to the large-scale installation of solar farms and the availability of vast, sun-rich land. Riyadh, for example, plays a pivotal role as it hosts many solar projects aimed at diversifying the Kingdom's energy sources. This regional dominance stems from strategic government investments in solar infrastructure and favorable climatic conditions that enhance solar energy production efficiency.
• Solar energy projects in Saudi Arabia are subject to strict licensing and compliance requirements. These include environmental assessments, safety certifications, and grid connection agreements. As of 2024, the Saudi Energy Regulatory Authority (SERA) has introduced new guidelines to ensure the quality and reliability of solar installations, including those utilizing tracking technologies. Compliance with these regulations is essential for project developers to avoid penalties and ensure smooth operation.

KSA Solar Energy Tracking Market Segmentation

• By Technology: The KSA Solar Energy Tracking market is segmented by technology into single-axis trackers, dual-axis trackers, and fixed tilt systems. Single-axis trackers hold a dominant share of the market due to their cost-effectiveness and ability to enhance energy output by 25-35%. They are particularly favored in large-scale solar projects across Saudi Arabia, as their simplicity in installation and maintenance offers a viable solution for maximizing solar power generation in desert environments.

• By Application: In terms of application, the market is segmented into utility-scale solar power, residential, and commercial & industrial. Utility-scale solar power leads in market share, primarily driven by large government-backed projects and significant investments in expanding solar energy capacity. The Kingdoms focus on utility-scale projects is evident in its efforts to meet renewable energy goals, particularly in solar farms like the Sakaka project, which emphasizes efficiency and high energy output.

KSA Solar Energy Tracking Market Competitive Landscape

The KSA Solar Energy Tracking market is consolidated, with major global players operating alongside a few regional companies. Companies such as NEXTracker Inc. and Array Technologies dominate the market, supplying advanced solar tracking systems. This consolidation is supported by key partnerships between foreign technology providers and local firms, enabling technology transfer and local production. The presence of these players underscores their expertise in providing reliable and efficient tracking solutions suitable for Saudi Arabia's climatic conditions.

KSA Solar Energy Tracking Industry Analysis

Growth Drivers

• Renewable Energy Adoption: The renewable energy sector in Saudi Arabia is witnessing rapid growth, primarily driven by the governments efforts to diversify the energy mix. Saudi Arabia's National Renewable Energy Program (NREP) has set an ambitious target of generating 27.3 gigawatts of renewable energy by 2025. Solar energy is a key component of this target, with the country focusing on large-scale solar farms. In 2022, renewable energy accounted for 1.3 gigawatts of installed capacity, which is expected to increase significantly by 2025. This push for renewable energy offers immense growth potential for solar energy tracking technologies.
• Government Initiatives (Saudi Vision 2030): Saudi Vision 2030 aims to reduce the nation's reliance on oil and increase renewable energys contribution to the national energy mix. The government has allocated $50 billion to develop renewable energy projects, with solar power at the forefront. The Sakaka solar plant, generating 300 megawatts of electricity, is one of several projects initiated under this vision. These government-backed initiatives directly drive the demand for solar energy tracking systems as the country shifts towards sustainable energy production.
• Increased Solar Farm Installations: Saudi Arabia has seen a rise in solar farm installations due to its abundant sunlight and government initiatives promoting solar energy. In 2022, over 1 gigawatt of solar capacity was operational, with multiple projects under development, including the 2.6-gigawatt Al Shuaibah solar farm. Solar farms require energy tracking systems to maximize efficiency, creating a favorable market for solar trackers. By 2025, solar farms will play a major role in Saudi Arabia's renewable energy landscape, fostering demand for advanced tracking technologies.

Market Restraints

• High Installation Costs: The installation of solar energy tracking systems remains expensive, posing a significant challenge to market growth. Despite a decline in solar panel costs, the overall installation costs for solar farms in Saudi Arabia remain high, ranging between $0.80 and $1.00 per watt for large-scale projects as of 2023. These costs include not only solar panels but also the necessary infrastructure and tracking systems. Government subsidies help, but the initial financial burden can still slow adoption rates.
• Supply Chain Disruptions: Global supply chain disruptions, exacerbated by the COVID-19 pandemic and geopolitical tensions, have affected the availability of key components for solar tracking systems. As of 2024, delays in the procurement of photovoltaic modules and electronic parts have increased lead times for solar energy projects in Saudi Arabia. Import-dependent markets like Saudi Arabia face challenges in securing the necessary components, contributing to project delays and increased costs.

KSA Solar Energy Tracking Market Future Outlook

Over the next five years, the KSA Solar Energy Tracking market is expected to witness substantial growth driven by continuous government support, technological advancements in solar tracking systems, and an increasing focus on sustainable energy sources. The Kingdom's ambitious renewable energy goals, particularly under Saudi Vision 2030, and large-scale solar projects are anticipated to propel the market further. The rise of dual-axis trackers and innovations in energy optimization through IoT will shape the future dynamics of this market.

Market Opportunities

• Technological Advancements in Solar Trackers: The global solar tracking technology market is evolving rapidly, with new advancements improving energy efficiency and durability. In Saudi Arabia, the adoption of dual-axis solar trackers, which increase energy production by up to 30%, offers a significant opportunity. As of 2024, innovations like weather-resistant materials and AI-driven optimization systems are being introduced, making solar trackers more viable in harsh climates. These technological improvements can significantly enhance the efficiency of solar farms in the Kingdom.
• International Collaborations for Research and Development: Saudi Arabias government has been engaging in international collaborations to drive research and development in renewable energy. In 2023, Saudi Arabia signed agreements with several European and Asian countries to collaborate on solar energy technologies, including advanced tracking systems. These collaborations will facilitate the transfer of cutting-edge technologies and expertise to local markets, fostering innovation in solar energy tracking and creating new growth opportunities for international players.