Saudi Arabia and the UAE have emerged as two of the world’s most prominent energy storage markets, with mega-scale projects announced and moved forward at a staggering pace over the last two years. But what does the next phase look like?
At the time of writing, projects totalling around 37GWh of BESS capacity in Saudi Arabia and around 28GWh in the UAE have been announced in operation, construction or procurement.
The two countries are transitioning to diversification from fossil fuel dependence, both as drivers of their economies and in their energy mix. As more solar comes online to replace that, they need large amounts of energy storage, and they need it fast.
Government the driver
Government bodies in the region can move very fast in response, both because of the nature of their political structures and the plentiful oil money to pour into projects.
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The projects announced so far have been driven or financed by a handful of state-owned bodies, and supplied exclusively (so far) by Chinese companies, spelt out in the table below.
In Saudi Arabia, it has been the Saudi Electricity Company (SEC) and the Saudi Power Procurement Company (SPPC), responsible for procuring power from IPPs.
In the UAE, two utilities – Emirates Water and Electricity Company (EWEC) and Dubai Electricity and Water Authority (DEWA) – have been driving projects alongside investment firm Masdar.
The projects are generally either directly-owned by these companies or are being procured under build-own-operate (BOO) whereby the state-owned company will procure the energy from the owner (via an SPV).
However, it is the directly-owned projects which have progressed the furthest, with the big tenders in both countries still ongoing. The exception is projects in Saudi by power generation firm ACWA Power, for the NEOM and AMAALA mega-infrastructure projects, but ACWA is still state-controlled.
“The government does want private sector projects to come in for the next phase of the market,” says Hammad Rabbani, managing partner at investment and financial services firm Burj Capital.
| Project | Commercial model / owner | BESS Supplier | BESS Capacity | Commercial operation date / target |
| Saudi Arabia | ||||
| Five projects across the country | SEC | BYD | 12.5GWh | Not clear |
| Najran, Madaya, Khamis Mushait BESS projects | SEC | Sungrow | 7.8GWh | 2025/26 |
| First large-scale tender | Build-own-operate for SPPC | Procurement ongoing – shortlist in January 2025 | 2GW/8GWh | 2026 |
| Tabuk and Hail BESS Projects | SEC | Hithium | 1GW/4GWh | 2026 |
| Bisha BESS | SEC | BYD | 2GWh | 2025 |
| AMAALA BESS | EDF, Masdar | Sungrow | 760MWh | 2027 |
| NEOM BESS | ACWA Power-owned | Sungrow | 600MWh | Not clear |
| Red Sea BESS | ACWA Power-owned | Huawei | 1.3GWh | 2024 |
| Total: c.37GWh | ||||
| United Arab Emirates | ||||
| World’s Largest Solar and Battery Storage Project | Masdar and EWEC | CATL | 19GWh | 2027 |
| EWEC 400MW BESS Project | Build-own-operate for EWEC | Procurement ongoing | 800MWh | 2026 |
| MBR Solar Park Phase 7 | Build-own-operate for DEWA | Procurement ongoing | 8.4GWh | 2027 |
| Total: c.28GWh |
Saudi Arabia’s projects would get it well on its way to its 48GWh large-scale BESS target for 2030, while the UAE has not announced a specific number.
Government-financing the first phase, independent international players the next
There are two main challenges for international independent power companies and developers wishing to launch projects in the region, explains Rabbani.
“One is on the EPC side. The market is changing so quickly in terms of technology and pricing that quotations are very short-lived. By the time due diligence is done things have changed drastically. That is one element that has to be managed,” Rabbani told Energy-Storage.news.
“It can take 3-4 months to get to financial close and project lenders want to see a full turnkey proposal, which makes things hard.”
The other challenge, he explains, is around policy frameworks.
“The projects have been sovereign wealth fund or local bank-financed, and they have not been electricity market-based but more financed on availability-based payments. Arrangements have been bespoke, as there’s been no such framework built in the region,” Rabbani says.
“There are a lot of things that need to be managed for lenders, around ESG, but also degradation as BESS technology has not really been tested yet at scale in the region. There are a lot of balls being juggled.”
Progress in solar could kickstart progress in BESS
Rabbani says the next phase of BESS projects in the region will be those big established private companies that are already advanced in building and operating solar projects in the region, possibly by adding BESS to those projects. He doesn’t see it as likely that a company will come in and do BESS on its own.
“But it’s very important for those international developers and IPPs to start taking a view on having storage,” he says.
That phased market development whereby generation comes first followed by storage is fairly typical elsewhere in the world. And announcements in late 2024/25 show that international power firms making strong progress on the solar side.
In November 2025, France-based EDF Renewables secured financing for two Saudi solar projects totalling 1.4GW in partnership with SPIC Huanghe Hydropower Development (SPIC HHDC) and Saudi Aramco Power Company (SAPCO). The 400MW Al Henakiyah-2 and 1GW Al Masa’a solar PV projects have 25-year PPAs with SPPC and will come online in 2027.
So far EDF had been the only outside company we are aware of to have finalised solar projects in the region, also securing financing for late 2020 and 2024. EDF was said at the time to hold 20% stakes in those projects. Its stake for the recent one wasn’t revealed, but it could be more, even a majority.
Then in January 2026, Masdar and another French firm, Engie, reached financial close on the 1.5GW Khazna solar project in Abu Dhabi, UAE. The project has a 30-year PPA with EWEC, and is scheduled for operation in 2028.
Both companies manage to secure financing from consortiums of local, East Asian and Western banks and financing institutions.
BESS technology and local climate
The local region has a very particular hot, dry climate, and Sungrow explains to Energy-Storage.news what this meant for its BESS technology provision.
“The frequent sandstorms and extreme climate conditions present significant challenges to the site project, necessitating that the product be equipped with the highest level of protection. Our product is designed with a C5 anti-corrosion rating, an IP55 protection level, and has successfully passed over 770 field tests. It is the industry’s first to achieve full-chain safety certification for both AC and DC sides,” a spokesperson says.
Rabbani points out that you obviously need very good cooling technology for BESS. But, the harsh climate means non-lithium technologies are being considered too, he says. One possibility is supercapacitors which have better temperature and changing time performance than lithium-ion.
Solar Media will host its first Energy Storage Summit Middle East this year on 7-9 April, in the Dubai World Trade Center. See here for more info and tickets.