Study Finds ‘Unprecedented Change’ in Demand for Electricity in Saudi Arabia

Study Finds ‘Unprecedented Change’ in Demand for Electricity in Saudi Arabia

Electricity demand in Saudi Arabia is undergoing unprecedented changes following the implementation of efficiency measures and energy price reforms, according to a study by the King Abdullah Petroleum Studies and Research Center (KAPSARC).

The Kingdom’s electricity demand is stagnating for the first time in decades, suggesting that consumer behavior has structurally shifted, raising uncertainties about the potential trajectory of long-term electricity demand.

KAPSARC projected the growth in total Saudi electricity demand to significantly decelerate over the coming decade compared with historical trends, to reach 365.4 terawatthours (TWh) by 2030.

The study predicted demand to grow more rapidly in the industrial and services segments than in the residential sector, accounting for the largest share of total consumption in 2030.

“We also simulate four additional scenarios for domestic electricity price reforms and efficiency policies,” said the study.

Aligning Saudi electricity prices with the average electricity price among G20 countries can reduce total electricity demand by 71.6 TWh in 2030, which could enforce efficiency policies that can reduce total electricity demand by up to 118.7 TWh.

“Moreover, alternative policy scenarios suggest that the macroeconomic gains from energy savings can alleviate some of the Saudi energy system’s burden on public finance,” said the study.

Projecting future demand for electricity is central