China’s Solar and Energy Storage Companies Rushing to Tap Middle Eastern Market

AsianFin -- China’s solar and energy storage companies are accelerating their expansion into the Middle East, scrambling to seize opportunities in one of the world’s fastest-growing renewable energy markets. This January alone, Chinese firms have secured major contracts and established strong presence in the region.

One example is a Chinese state-owned energy infrastructure employee who shared on social media about his plan to spend this upcoming Chinese New Year in the UAE. His company is managing a solar project near Abu Dhabi, and preparations require key personnel to be on-site. This reflects a broader trend: Chinese enterprises are investing heavily in Middle Eastern renewable projects, both through project execution and equipment supply.

On January 15, the world’s largest single-site solar power project, the Al Shuaibah 2.6GW photovoltaic plant in Saudi Arabia, constructed by China Energy Engineering Corporation, was officially connected to the grid. Just a day later, China Power Construction Group won the contract for the world’s largest solar and storage project, the RTC solar-storage project in the UAE.

These headline projects highlight the growing demand for renewable energy in the Middle East. Prominent Chinese equipment suppliers, such as JinkoSolar, Sungrow, and Sineng Electric, were integral to the Al Shuaibah project. In the RTC solar-storage project, JinkoSolar and CATL have already been selected as the primary module and energy storage system suppliers, respectively, further cementing China’s foothold in the region.

The Rise of the Middle Eastern Market

The Middle East’s renewable energy ambitions have gained momentum since Saudi Arabia launched its National Renewable Energy Program (NREP) in 2016. After 2020, the region saw a surge in renewable project tenders and construction, fueled by energy transition goals and economic diversification efforts.

For Chinese companies, the region’s clean energy market expansion comes at a critical juncture. In recent years, the U.S. and European markets have erected trade barriers, while Southeast Asia’s manufacturing hubs have faced increasing scrutiny. Meanwhile, China’s domestic solar market has suffered from price wars and slowing demand growth. These challenges have pushed Chinese firms to explore new markets, with the Middle East as a prime destination.

Data from the China Photovoltaic Industry Association indicates that Chinese solar exports to the Middle East surged in 2024. The total export value reached 26.3 billion yuan ($3.7 billion), up 23.4% year-over-year, bucking the overall downward trend in global solar export values.

Saudi Arabia was the largest Middle Eastern market for Chinese firms, with imports of Chinese solar modules increasing by 43.1% to 13.5 billion yuan ($1.9 billion). The UAE followed with a 28.3% rise, reaching 3.6 billion yuan ($510 million). Oman also saw explosive growth, with imports soaring 230%, making it the third-largest Middle Eastern market for Chinese solar products.

Globally, the Middle East’s share of China’s solar exports grew from 8% in 2023 to 13.1% in 2024, underscoring its importance as a burgeoning market.

From Exports to Localized Manufacturing

Beyond exporting products, Chinese firms are increasingly looking to establish local manufacturing bases in the Middle East. By the end of 2024, at least ten Chinese solar manufacturers announced plans to build factories in the region, covering everything from silicon wafers to solar modules. These projects are substantial, with production capacities often exceeding 10GW per facility—far larger than similar investments in other regions.

For energy storage companies, the Middle East is also becoming a priority. Ganfeng Lithium and EVE Energy have announced plans to build battery plants in Turkey, while Sunwoda Storage announced a joint venture in Saudi Arabia to establish a 5GWh energy storage system factory.

The shift toward localized production reflects the growing importance of the Middle East as not just a market for exports but also a strategic hub for global operations.

Why the Middle East?

The inauguration of Donald Trump as U.S. President has brought about significant uncertainty into the American renewable energy market. On his first day in office, Trump rolled back over a dozen climate-related policies from the Biden administration, including incentives for solar and storage projects under the Inflation Reduction Act (IRA). His administration also withdrew the U.S. from the Paris Climate Agreement, further signaling a shift back to fossil fuels.

These changes have created challenges for Chinese renewable firms operating in the U.S., making the Middle East an even more appealing alternative.

Looking ahead, analysts are optimistic about the Middle East’s renewable energy growth. According to the Middle East Solar Industry Association (MESIA), the region’s solar capacity is expected to grow at a compound annual rate of 30% through 2030. On the energy storage front, analysts predict a fivefold increase in installations by 2025, reaching 20GWh, with a further doubling to 40GWh by 2026.

As global renewable energy markets undergo significant shifts, the Middle East is emerging as a critical battleground. For China’s solar and energy storage companies, this region represents not only a market with immense potential but also a strategic opportunity to establish a long-term presence.

With increasing investments, new factory announcements, and landmark project completions, 2025 is poised to be a milestone year for China’s renewable energy expansion in the Middle East.