Currently, the economy of Middle Eastern countries relies heavily on fossil fuel sources. The direct and indirect adverse consequences of fossil fuel utilization for power generation enforce the region’s countries to raise the share of renewable energy. In this context, various incentive policies have been developed to encourage the residential and industrial sectors to support a portion of energy needs through renewable energy resources. In this case, a solar water heating system (SWHS) as an application of solar thermal technology provides some of the heat energy requirements for domestic hot water (DHW) and space heating, supported conventionally by electricity or natural gas, or even other fossil fuels. This paper reviews the feasibility of the SWHS in the Middle East region from technical and economical standpoints and investigates some of the progress, challenges, and barriers toward this market. The pay-back times and CO₂ emission reduction under different incentive frameworks and configurations of each system have been assessed in this context. Furthermore, the advantages and weaknesses of the SWHS in several countries have been reported. Finally, various guidelines have been proposed to enhance the development of this technology.

This paper investigates the economic viability of a commercial grid-connected photovoltaic system (GCPVS) in the Middle East region. In this regard, an economic assessment of a 120 kW_p GCPVS connected in December 2017 under a feed-in tariff (FiT) scheme in Iran—the leading country in the region establishing a supportive policy—is carried out. In this plan, private enterprises can install GCPVS and sell whole generated energy at a high guaranteed price for twenty years. Several economic indices, including net present value (NPV), internal rate of return (IRR), benefit-cost ratio (BCR), payback period time (PBT), and levelized cost of energy (LCOE) are determined to unveil the effectiveness of the enacted program. This paper exploits one-year recorded energy data of this commercial system to boost the reliability of the results. Moreover, PV module degradation factor is taken into account to make the analysis as realistic as possible. The computed outputs imply that this commercial system, with 3.36 BCR, 31.88% IRR, 5.24 years PBT, and 0.0477 $/kWh LCOE, is highly appealing. The sensitivity analysis also highlight that the profitability of the GCPVS investment is secure under a wide range of unpredictable parameters. It is shown for instance that the PBT and IRR are deteriorated by 5.48% and 1.50 years, while the generated energy lowers by 20% compared with the predicted value for the upcoming years. Having said that, it is still far away from the infeasible condition. A comparative analysis between the current findings and similar researches endorse the Middle East region as the highest potential site for PV installation. It is finally deduced that a properly modified FiT scheme can be set in the region's countries concerning the local meteorological and economic conditions to stimulate the investment of this technology.