With surging power demand and bold decarbonization targets, solar parks are a linchpin in MENA’s energy transition. The region now boasts over 24 GWAC of solar capacity as of early 2025. Projections indicate this will exceed 180 GW by 2030, mostly led by Saudi Arabia, the UAE, and Egypt. Yet, opportunity comes with risk. Not every solar park reaches financial close or successful commissioning, and the difference often lies in sound technical preparation and risk discipline.
Solar parks in the right hands generate jobs, cut emissions, and deliver stable returns. However, this is possible only if their foundations are bankable, technically robust, and contractually sound.
1. Overestimated Yield Projections
Numerous global studies have found a persistent bias, with actual plant performance 3–13% lower than forecasts due to factors such as overoptimistic irradiation assumptions and overlooked curtailment losses. This gap can erode IRR and debt coverage, making conservative and independently validated energy estimates essential for financing.
2. Grid Integration and Curtailment Risk
Grid bottlenecks are a widespread issue across the MENA region. Delays in interconnection and post-commissioning curtailment have become major contributors to revenue shortfalls and penalty triggers.
Lenders increasingly require upfront confirmation of grid capacity, SCADA integration, and mitigation of local network instability.
3. Weak EPC Contracts & Execution Gaps
Loose or incomplete EPC (Engineering, Procurement, and Construction) contracts expose investors to delivery risks and unclear performance guarantees. They also lead to unresolved disputes—a recurring barrier to bankability in fast-growing solar markets.
4. Incomplete Technical Studies
Rushed feasibility studies, missing soil/hydrological work, or poorly validated designs frequently lead to cost overruns and construction delays. Robust pre-feasibility, soil/geotechnical, PPA, and financial modeling are now prerequisites for international financing.
Technical or contractual gaps directly depress IRR and lower the Debt Service Coverage Ratio (DSCR). They also threaten adherence to Power Purchase Agreement (PPA) milestones. Lenders now seek fully integrated, multi-scenario financial models that combine operational, yield, and contractual realities with robust risk analysis.
Lenders and institutional investors now require credible ESG (Environmental, Social, Governance) alignment—demonstrating biodiversity stewardship, fair labor practices, and rigorous project governance. Integration of ESG with technical and financial metrics (e.g., via Clenergize ESG+™) makes projects more attractive to green capital pools and enhances long-term resilience.
Clenergize leverages multi-GW regional experience for clients on both sides of the table—lenders and owners. Our team delivers clear gap assessments and bankable studies. We also provide contract structuring and ESG data strategy tailored for successful financial closing in the MENA context.
In the race to build utility-scale solar, meticulous preparation is the difference between profit and pitfall. With global best practices, regional know-how, and integrated technical/ESG advisory, Clenergize makes solar parks investment-ready—de-risking projects from initial yield studies to long-term compliance.
