Suntech Power Holdings Co., Ltd. (STP) announced that a 3.5 megawatt ground mounted photovoltaic (“PV”) system with Suntech panels has been completed in Saudi Arabia. This ground mounted solar system is the largest PV system in the Kingdom of Saudi Arabia.
The solar field has been designed and built by Phoenix Solar. Located on the grounds of the King Abdullah Petroleum Studies and Research Center (KAPSARC), the system is owned by Saudi Aramco. KAPSARC is located in Riyadh, Saudi Arabia and is the world's largest energy research center.
Spread across an area of 55,000 square meters, the system comprises of 12,684 Suntech panels and inverters from SMA Solar Technology AG (S92). On an annual basis, the grid connected system has the capacity to supply 5,800 megawatt hours of electricity and can offset approximately 4,900 tons of carbon dioxide (CO2) emissions.
Saudi Arabia is working on the generation of environment friendly sources of electricity. The world’s largest crude oil exporter intends to generate one-third of its electricity from the sun by 2032. Primarily, it plans to boost renewable energy use to cut down on oil consumption used for domestic desalinization and power plants. Recently, ReneSola Ltd. (SOL) has received an order for the delivery of 15 kilowatts of solar modules from the Taibah University in Medina, Makkah Province, Saudi Arabia. The modules delivered by ReneSola will be used in an off-grid power plant project to test off-grid solutions.
In fact, the Middle East in general is opting for solar power to reduce its large carbon footprint and dependency on fossil fuel sources. With its extensive deserts and prolonged periods of sunny days, the region would be the perfect place for utilization of solar energy. Saudi Arabia currently has around 3 megawatts of solar installations followed by other countries like UAE, Egypt, Morocco, Tunisia and Algeria. This makes it a happy hunting ground for solar module manufacturers like Suntech Power Holdings, Canadian Solar Inc. (CSIQ) and JA Solar Holdings Co., Ltd. (JASO).
Suntech Power Holdings Company Ltd. is one of the largest producers of crystalline solar cells and modules, serving geographically diverse customers. Its modules are best suited for the dry climates of Saudi Arabia and the Middle East. The company is prudently expanding its revenue base to divergent markets around the globe, while increasing megawatts shipped.
However, we remain concerned about tepid module demand in Europe, rising competition, the volatile euro and the financial stability of its customers. The company presently retains a short-term Zacks Rank #4 (Sell).