ACWA Power Faces Dispatch Restrictions At Key Saudi Solar Projects Amid Grid Stability Concerns

ACWA Power has reported temporary operational challenges at two of its major solar independent power producer (IPP) projects in Saudi Arabia due to dispatch restrictions imposed by the national grid operator. The curbs were introduced after concerns emerged over reactive power fluctuations, a technical issue that can affect grid stability and reliability.

The affected projects include the Al Kahfah solar plant, with a capacity of 1,425 MW, and the larger 2,000 MW Ar Rass 2 facility. Al Kahfah began commercial operations in late 2025 but faced restrictions from December. Although partial dispatch was allowed from February 2026, the plant continues to operate below full capacity. This has resulted in a revenue dispute estimated at around SAR 95 million (approximately $25.3 million).

Similarly, Ar Rass 2, which received its commercial operation certificate in September 2025, encountered dispatch limitations starting mid-January 2026. Since March, the project has only been permitted partial operations, leading to an estimated financial impact of SAR 73 million.

In response, the project entities have formally contested the grid operator’s findings. The company has initiated detailed technical evaluations to confirm that its systems meet all required operational standards. To ensure objectivity, independent third-party experts have also been engaged to assess plant performance and grid interaction.

At the same time, ACWA Power is maintaining an active dialogue with Saudi authorities to resolve the issue and restore full operations. Meanwhile, the company is safeguarding its revenues by issuing “deemed energy” invoices, allowing it to claim compensation for electricity it could have generated but was unable to supply due to imposed restrictions.

The situation highlights the growing technical complexities associated with integrating large-scale renewable energy projects into national grids, particularly as countries accelerate their clean energy transitions.