Grappling with relentless heat, ageing infrastructure and unplanned power outages has prompted major investments in grid reliability in Kuwait. Today, renewables account for less than 1% of Kuwait’s electricity generation, but the country aims to grow that to 15% by 2030, with natural gas serving as a transitional fuel. However, Rystad Energy says its analysis suggests this lofty target could be out of reach.  

Its current projections estimate renewables capacity will only reach 3.3 GW by 2030, just 7% of Kuwait’s power generation, with a renewables share of 15% by 2035 considered ‘a more realistic target’. By that time, renewables capacity is expected to exceed 11 GW, accounting for around 20% of Kuwait’s power generation, it says.

Currently, Kuwait has 21 GW of installed capacity of renewables, but only about 17 GW of this is reliably available during peak months – due to planned maintenance and the age of its plants, reports Rystad. In recent years, temperatures have climbed as high as 50°C. As demand peaked at 17.7 GW in July, scheduled power cuts began two months earlier than the previous year, while unplanned outages added further strain, creating shortages of more than 1.5 GW in May, it adds.

‘Blackouts in Kuwait have underscored the strain on the country’s power system, making imports unavoidable if such outages persist,’ comments Nishant Kumar, Analyst, Renewables & Power Research, Rystad Energy. ‘As Kuwait modernises and turns to renewables to address these challenges, high-profile events like the 2025 Iberian outage have raised questions about the reliability of renewable energy. Still, it would be myopic to dismiss the capabilities of renewables outright. Kuwait has plans to invest heavily in solar PV, for instance, benefiting from a natural advantage of more than 3,300 hours of sunlight each year. This abundant sunlight supports PV output of 4.6–4.9 kWh per kW-peak per day, helping to meet peak afternoon demand when electricity use is highest.’

As this transition takes place, gas is set to play a vital role in Kuwait’s energy future as the nation expands its use of renewable energy. Rystad Energy’s analysis indicates that Kuwaiti gas power generation is set to increase by 17% to 77 TWh by 2030. As a result, gas production is expected to rise by 38%, while overall gas demand is forecast to increase by 30% in the next five years.

The increase in demand will be covered by a combination of rising domestic gas production and ongoing LNG imports, ensuring round-the-clock supply. Examples of this can be seen in Kuwait’s planning of five large-scale gas-fired power plants that will add 18 GW of capacity, lifting total gas power capacity to more than 32 GW by 2035, up from 14 GW today, says Rystad. On the import side, state-owned Kuwait Petroleum Corporation (KPC) has signed a 15-year LNG sale and purchase agreement with QatarEnergy, securing up to 3mn t/y of supply.

Kuwait is focused on reducing domestic oil consumption by gradually replacing oil with gas in its power generation mix, which currently accounts for 40% of its energy needs, according to Rystad. ‘The main goal is to free up more crude for export, as oil sales remain the backbone of Kuwait’s economy and provide the bulk of its government revenue. By shifting its power sector toward gas, the nation aims to maximise export earnings, strengthen its fiscal position and secure long-term revenue streams in the face of rising domestic power demand,’ it says.

Kuwait’s annual gas demand is currently between 24–25bn m³, with the power sector consuming the largest share, according to Rystad analysis. Around 40% of this demand is met through LNG imports, while oil-associated gas production supplies about 35%. ‘This reliance on associated gas exposes Kuwait to OPEC+ crude output cuts, directly affecting gas availability,’ it says. ‘To mitigate this risk, the country has invested heavily in non-associated gas through onshore developments and offshore exploration, achieving notable progress in recent years. Non-associated gas now contributes nearly 600mn cf/d, or about 25% of total demand, with all volumes currently coming from the onshore Jurassic project, located in Kuwait’s north.’

Oman maps out $97.48bn energy investment programme

Elsewhere in the Middle East, Oman has mapped out a $97.48bn investment programme across its energy system through 2032, with green hydrogen taking the largest share, according to a new report from the Energy Industries Council (EIC).

The report counts 76 projects under development, spanning hydrocarbons, power, renewables and transition technologies. It also sets out how the Gulf Arab state plans to roll out hydrogen projects, upgrade its grid in stages and prepare export infrastructure in parallel.

Hydrogen, which is associated with 16 development projects, is at the centre of the country’s energy plans. Two auction rounds have awarded eight large-scale hydrogen projects in Duqm and Dhofar, with a third round underway. The awarded schemes pair multi-gigawatt solar and wind inputs with green hydrogen production, mostly converted into ammonia for export. These developments could see an estimated $49bn in investment supported by approximately 29 GW of renewable capacity, positioning the country as a major hub in the global clean energy transition, says the EIC.

Beyond hydrogen, the report tracks major investments across other sectors, including $19.05bn downstream, $13.79bn midstream, $9.86bn in renewables, $4.9bn upstream, $1.08bn in power, $780mn on energy storage, $730mn in sustainable aviation fuel (SAF), and $150mn on carbon capture and storage (CCS).

LNG, part of the midstream portfolio, will play a key role in sustaining revenue streams while hydrogen projects scale up, notes the EIC. One such project is Marsa LNG, now in engineering, procurement and construction (EPC), with a 2028 start-up target.

Among downstream projects is DRPIC’s petrochemicals complex, now in early design and targeting completion by 2029. ‘Global trends have impacted the development of downstream projects in Oman,’ the report says, citing shifting energy demand, stricter environmental regulations and rising project costs as key factors. ‘Globally, large refinery and petrochemical projects face delays as investor appetite cools in response to long payback periods and oversupply in markets like China,’ it adds.

Oman plans to add around 5.5 GW of renewable power between 2027 and 2032, including 3.28 GW of solar photovoltaic and 0.6 GW of concentrated solar power. 2.57 GW of onshore wind is expected to come online by 2030, forecasts the report.

Despite these ambitions, the report flags key pressure points. Final investment decisions depend on bankable offtake agreements for green hydrogen and ammonia. Grid integration will require large-scale energy storage, but so far only small battery units have been confirmed, tied to scheduled power delivery. Hydrogen developments also need to factor in water use and brine disposal, which affect cost and permitting. Regional competition for contractors and materials could also slow progress.

‘Oman’s approach pairs auctioned land, awarded to hydrogen developers through competitive rounds, with defined renewable energy inputs to power production,’ comments report author Shaheera Shaharuzzaman, Energy Analyst. ‘Export volumes ramp as projects scale, while LNG and petrochemicals sustain near-term receipts. Power projects come online in set windows, and a reliable gas network reduces integration risk. This structure positions Oman to scale in stages while keeping the system stable.’

Ryan McPherson, EIC Regional Director for Middle East, Africa & CIS, adds: ‘Across the technologies we track, few markets have joined the dots like Oman. The design encapsulates the whole system, with policy, land, power and export channels pulled into one integrated plan. What this does is give investors a clear line of sight across the energy production chain, and room to grow without losing control. It’s a real opportunity for the country.’