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Saudi Arabia Bets Big on Solar to Power AI, Tourism, and Hydrogen Future

Saudi Arabia, long known as the world’s leading oil exporter, is rapidly emerging as a solar power hub. The kingdom is building some of the world’s largest solar farms and massive battery storage facilities to support its growing energy needs from tourism resorts, AI-driven data centers, and industrial expansion. By shifting away from burning oil for electricity—a practice that costs it an estimated $20 billion annually in lost exports—Saudi Arabia aims to free up crude for global markets while diversifying its economy.

Crown Prince Mohammed bin Salman’s Vision 2030 strategy targets 50% of electricity from clean energy by 2030, with ACWA Power spearheading projects to deliver nearly 100 GW of capacity. Progress, once sluggish, is now accelerating, with $8.3 billion committed last year to 15 GW of solar and wind projects, on top of existing developments. Analysts now forecast that renewables could contribute a third or more of Saudi Arabia’s power mix by 2030, positioning the country among the world’s top five solar markets.

Challenges remain, including grid integration, equipment durability in desert conditions, and skilled workforce shortages. Yet government backing, low-cost financing, and cheap Chinese solar technology have made solar power in Saudi Arabia among the world’s most affordable. Beyond domestic projects, ACWA is also expanding abroad, including work on the world’s largest renewable hydrogen facility. This shift signals a major transformation, with solar energy now central to Saudi Arabia’s economic and geopolitical strategy.