As in many global markets, solar energy is on the rise in countries across the MENA region (Middle East and North Africa). This has pushed economic developments ahead of policy developments: While some countries are currently working on incentive programs for the future, rising energy prices are already boosting the profitability of renewable energy. Investment in solar energy is particularly worthwhile for countries dependent on oil and gas imports, such as Jordan or Morocco, or states that use large quantities of their own oil reserves for power generation, such as Saudi Arabia or Kuwait. The climate of optimism surrounding the industry is reflected in the numerous large-scale projects, such as the Mohammed bin Rashid Al Maktoum Solar Park in Dubai, which is currently at the planning stage. Once completed, the solar park is expected to provide one gigawatt (GW) of power. With oil prices in excess of US$80, photovoltaics is competitive with fossil-fuel power generation in most countries in the region. The international price of crude oil has even lingered over the US$100 mark for some time, which has already given photovoltaics a strong upper hand in many applications. Off-grid solar installations in remote areas, for example, are even more efficient and cost-effective compared with grid-connected installations. These are clear signs pointing to growth in the region's solar industry. Faced with an increasing electricity demand driven by dynamic economic growth and energy-intensive industries, the MENA region could catch up with leading solar markets such as Germany, Italy and the USA by 2025. And the potential is vast - solar irradiation has reached over 2,000 kilowatt hours (kWh) per sq. mtr/year, the solar energy yield is almost double that obtained in Germany. Furthermore, photovoltaic power plants, in particular, can be planned and built in significantly less time than many other types of power plant, meaning that solar energy also accommodates rapid economic growth. Governments have now recognized the opportunity which solar energy generation holds for the region and the future of the energy supply: Dubai and Saudi Arabia are expected to pass comprehensive solar legislation in the next 6-12 months. Abu Dhabi, Jordan, Kuwait and other MENA countries are expected to follow suit over the next year or two. Morocco is already one step ahead, having established the Moroccan Agency for Solar Energy (MASEN) over a year ago. Solar photovoltaic electricity is competitive with conventional fossil fuel-based electricity generation, particularly for peak demand during the middle of the day, in the Middle East and North Africa (MENA), according to a report by Manaar Consulting commissioned by the Emirates Solar Industry Association (ESIA) and sponsored by PwC. Factors such as falling costs of solar PV panels, rising costs of fuels used in conventional power generation and excellent fit to demand patterns challenge the prevailing view among many policy makers and utilities in the MENA region that solar is expensive unless heavily subsidised. In the case of some countries such as Saudi Arabia, domestic consumption of fossil fuels is steadily rising creating a demand for new sources of electricity. The research posits that solar is well matched to demand patterns in the Gulf, unlike Germany – the world’s largest solar market – where demand patterns are not as complementary, such as during the evening on a typical winter’s day when there is little sun about. In MENA the demand patterns are completely different. There is a peak in demand during the middle of the day when everyone is at work and air-conditioning units are running. In countries such as Lebanon, Northern UAE countries, Jordan and Morocco where there is little domestic gas production and high use of oil for power, solar saves significantly on fuel costs and enhances energy security, making it a very attractive option. In countries such as Saudi Arabia, Kuwait and Syria, where there is significant domestic gas but insufficient to meet demand, solar PV generation can free up domestic oil consumption for export, which is economically attractive. In the Middle East, the transition to solar energy has begun, but the pace and momentum of the transition will be influenced by policy, as discussed in the Solar Investment Summit - Middle East. Saudi Arabia’s largest industrial entities, including petrochemical company Saudi Aramco, plastics producer Sabic and Saudi Telecom Company (STC) are initiating solar projects. In addition, national research agency, King Abdulaziz City for Science and Technology (KACST) is developing a desalination plant that will be powered by solar thermal energy. Across the region, the need for clean water, both for drinking and for agriculture, will become more acute and several states, including Qatar and Kuwait, are looking into the potential of solar powered desalination. Jordan, one of the smallest states in the Middle East, imports 96% of its energy supply. The country is looking to renewables to make its energy supply more secure. Last year, Jordan’s gas supply, from Egypt, was interrupted six times over a period of 180 days, the equivalent of a 1.5 MW photovoltaic plant for each day of interrupted supply. By 2020, Jordan wants to reduce its energy imports to 61%. Domestic firm Kawar Energy is conducting a feasibility study for a 100 MW photovoltaic or concentrated photovoltaic (CVP) plant, which has the potential to scale up to 500 MW. The government is gathering the information it needs to formulate a policy on renewable energy and Kawar will present a final proposal for the photovoltaic project in the first part of 2012.