Saudi Arabia's energy storage market is advancing with a new approach. Following its first multi-GWh storage procurement in late 2024, the Saudi Power Procurement Company (SPPC) recently opened pre-qualification for a second batch of battery energy storage system (BESS) projects.
This new round includes six projects, each configured at 500MW / 2000MWh, bringing the total capacity to 12GWh. Compared to the initial round, the shift from project-by-project development toward a replicable, system-level framework is becoming evident.
Source: Industry reporting
Six Projects, One Unified Specification
The most notable feature of this tender is the technical standardization across all six projects.
4-hour discharge duration – With rapid growth in domestic PV capacity, grid demand is moving from frequency regulation and ancillary services toward deeper peak-shaving and capacity support. A 4-hour duration balances daily peak coverage with economic feasibility.
500MW / 2000MWh per project – This scale challenges battery container layout, PCS step-up integration, and associated 380kV substation engineering. It demands robust energy management, multi-device coordination, and grid stability support (voltage, frequency, and system resilience) for ultra-large-scale storage interconnection.
By standardizing size, capacity, and duration, SPPC is creating a repeatable asset template for future storage deployment.
Business Model: 100% Ownership Under BOO Framework
SPPC continues to use the Build-Own-Operate (BOO) model. Winning consortia must hold 100% equity in a special purpose vehicle (SPV) and sign a long-term Storage Service Agreement (SSA) with SPPC.
The structure locks in long-term cash flow and treats storage as a financeable energy asset rather than a one-time equipment purchase. Although the contract duration for this round has not been disclosed, the first batch referenced approximately 15-year terms. This model requires developers to have strong financing capabilities and full life-cycle system operation experience.
Developer Pre-Qualification Pool Under Preparation
A noteworthy detail: alongside the storage pre-qualification, SPPC simultaneously opened pre-qualification for solar PV, wind, and future storage projects. This pre-approves a pool of qualified developers, enabling faster entry into subsequent tenders without restarting the screening process each time.
Regional Targeting: High-Load and Grid-Weakness Areas
The six projects are distributed across Saudi Arabia's load centers and grid bottlenecks:
| Region | Projects |
|---|---|
| Makkah | Al-Leeth, Khulis, Ashyrah (3 projects) |
| Qassim | Samha (1 project) |
| Madinah | Al-Henakiyah (1 project) |
| Eastern Province | Sadawi (1 project) |
The concentration of three projects in Makkah addresses seasonal peak demand (e.g., religious periods) and ongoing urban load growth. The Eastern Province project serves the industrial load center requiring high supply reliability. Qassim, a hub for renewable energy development, focuses on power smoothing and grid regulation.
Sources: SPPC announcements, industry analysis
Longsun Green – A professional solar mounting system manufacturer, providing engineered solutions for tile, metal, and flat roof PV installations.
For more information:
📧 amber@longsungreen.com
🌐 www.longsungreen.com
