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GCC mega developments could cut power costs by a third with solar
New report finds Gulf mega-projects could meet up to 35% of their electricity demand through on-site solar, reducing costs while enhancing sustainability and energy resilience
- PUBLISHED: Thu 30 Jul 2026, 7:00 AM
Large-scale urban developments across the Gulf could generate up to a third of their electricity needs through on-site solar power while achieving comparable reductions in energy costs, according to a new report from Boston Consulting Group (BCG).
The report, Mega-Projects Powered by Renewables: A Practical Playbook for Saudi Arabia, argues that renewable energy remains one of the most underutilised opportunities available to developers as Gulf countries accelerate investment in new cities, mixed-use districts and economic zones. Although the study focuses on conditions in Saudi Arabia, BCG said its findings are relevant across the GCC, where abundant solar resources, expansive master-planned developments and evolving regulatory frameworks are creating favourable conditions for renewable energy adoption.
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The consultancy’s analysis suggests that, depending on a project’s design, density and local regulations, as much as 35 per cent of electricity demand could be met through solar installations integrated directly into developments. Developers could potentially reduce electricity costs by a similar margin, particularly through power purchase agreements and energy-as-a-service models that eliminate the need for significant upfront capital investment.
“The region’s mega developments represent a generational opportunity to reshape how we think about urban energy infrastructure,” said Edoardo Geraci, Managing Director and Partner at BCG. “Developers in the region who integrate renewables from the master planning stage are not only reducing their operational costs but also future-proofing their assets against evolving carbon regulations and energy price volatility. The economic case has never been stronger.”
The report highlights how renewable energy can be incorporated from the earliest stages of urban planning to maximise long-term value and avoid costly retrofits. Rather than requiring additional land, solar systems can be integrated into existing infrastructure through rooftop installations, building-integrated photovoltaics, carports and shaded structures, making them suitable even for dense urban environments.
BCG’s findings also indicate that individual buildings can achieve varying levels of energy self-sufficiency. A typical single-family villa could meet around half of its annual electricity demand through rooftop solar, while a mid-rise residential building may satisfy approximately 15 per cent of its needs. According to the report, rooftop systems alone could generate roughly 35 megawatt-hours of electricity annually for a villa and about 190 megawatt-hours for a mid-rise building, delivering both cost savings and lower carbon emissions.
The consultancy noted that renewable energy deployment is already gaining momentum across the GCC, with multi-megawatt solar installations being rolled out in residential, commercial and industrial developments. These projects, it said, are demonstrating the technical and commercial viability of integrating solar power into urban infrastructure at scale.
BCG also challenges what it describes as three persistent misconceptions surrounding renewable energy adoption: that solar installations require extensive space, involve prohibitive upfront costs and are too complex to implement. Advances in technology and financing models, the report argues, have significantly reduced these barriers.
“What makes this moment particularly compelling is that the perceived barriers to adoption have largely been dismantled,” said Peter Jameson, Managing Director and Partner at BCG. “Modern solar solutions can be seamlessly integrated into rooftops, facades, and shade structures without compromising architectural vision. Financing innovations have removed upfront capital requirements entirely for many developers. The projects that act now will define the benchmark for sustainable urban development across the region.”
Associate Editor Somshankar Bandyopadhyay brings more than three decades of experience to the KT newsroom. Currently, he manages the news production of the business section, ensuring that the top economic and business news of the day reaches its readers.