The Iran war has made financing Gulf solar and wind projects more difficult, but the economics still stack up firmly in their favor. The region is expected to add 12 gigawatts of renewable energy capacity this year and twice as much next year, according to a BloombergNEF report. While some delays can be expected, the recent delivery of turbines to Saudi Arabia and the commissioning of a 1.1 GW wind farm in the kingdom indicate the region has been able to access the equipment and material required to complete projects.
Disruptions to oil and gas exports have highlighted just how reliant Gulf economies still are on fossil fuel revenues, and the importance of renewable energy to reduce this dependency. Despite the current strain on national budgets, governments and firms in the region are pursuing projects that can free up more oil and gas for export, while providing lower-cost electricity and supporting new data centers.
