Large-scale urban developments across the Gulf could reduce electricity costs by as much as 35 per cent by incorporating on-site renewable energy, according to a new report from Boston Consulting Group (BCG).
The study, Mega-Projects Powered by Renewables: A Practical Playbook for Saudi Arabia, argues that embedding renewable energy into the early planning stages of major developments can deliver significant financial and environmental gains.
Although the research focuses on Saudi Arabia, BCG said its findings are relevant across the Gulf Cooperation Council (GCC), where abundant sunlight, expansive development sites and evolving energy policies create favourable conditions for renewable integration.
The consultancy said solar power could supply up to 35 per cent of the electricity needs of large-scale urban projects, helping developers lower operating expenses, strengthen energy security and protect investments against rising energy prices and tightening carbon regulations.
Alternative financing options, including power purchase agreements (PPAs) and energy-as-a-service models, are also making renewable adoption more accessible by reducing or eliminating upfront capital costs.
“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 who integrate renewables from the master-planning stage can reduce operating costs while future-proofing their assets against evolving carbon regulations and energy price volatility.”
The report also found that individual buildings could achieve higher levels of energy independence through solar installations. Single-family villas could generate around half of their annual electricity demand from solar energy, while mid-rise residential buildings could meet approximately 15 per cent of their needs, depending on design and location.
According to BCG, rooftop solar systems alone could produce up to 35 megawatt-hours (MWh) of electricity each year for a villa and as much as 190 MWh annually for a mid-rise building.
The report challenges common misconceptions surrounding solar deployment, arguing that concerns over land availability, installation costs and technical complexity are becoming less relevant.
It notes that rooftop solar panels, building-integrated photovoltaics, solar carports and shaded solar structures can be incorporated into developments without requiring additional land or compromising architectural design.
“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 integrated into rooftops, façades and shade structures while financing innovations have removed upfront capital requirements for many developers.”
Beyond cost savings, BCG said renewable energy infrastructure can also enhance the identity and attractiveness of new urban developments, with visible solar features contributing to their appeal among residents, investors and visitors alike.
