Saudi Arabia Energy-Efficient Buildings Market Overview

Market Size in 2025: USD 1.4 Billion

Market Forecast in 2034: USD 2.3 Billion

Market Growth Rate 2026-2034: 5.51%

According to IMARC Group's latest research publication, "Saudi Arabia Energy-Efficient Buildings Market Size, Share, Trends and Forecast by Material, End Use, and Region, 2026-2034", the Saudi Arabia energy-efficient buildings market size reached USD 1.4 Billion in 2025. Looking forward, IMARC Group expects the market to reach USD 2.3 Billion by 2034, exhibiting a growth rate (CAGR) of 5.51% during 2026-2034.

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How AI is Reshaping the Future of Saudi Arabia Energy-Efficient Buildings Market

• AI-driven building management systems are revolutionizing energy optimization across Saudi construction projects, with IoT sensors and machine learning enabling real-time monitoring of HVAC, lighting, and climate control to cut consumption by up to 30%.
• Smart building technologies integrated with predictive analytics are transforming maintenance schedules, identifying equipment failures before they occur and reducing operational downtime while extending asset lifecycles in commercial and residential developments.
• Digital twin technology powered by AI is enabling architects and developers to simulate building performance during design phases, optimizing energy efficiency and sustainable material selection before construction begins on mega-projects like NEOM and Qiddiya.
• AI-powered energy management platforms are being deployed across Saudi data centers and smart cities, with HUMAIN's AI infrastructure driving innovations in cooling systems and integrated design that reduce environmental impact while meeting escalating compute demands.
• Machine learning algorithms are optimizing prefabricated and modular construction processes, improving material efficiency and reducing waste through precise calculations in controlled factory environments, advancing Vision 2030's sustainability targets.

Saudi Arabia Energy-Efficient Buildings Market Trends & Drivers:

One critical driver accelerating the Saudi Arabia energy-efficient buildings market is the integration of smart technologies into building management and automation systems. IoT sensors, artificial intelligence, and cloud computing are being deployed to optimize energy usage across lighting, heating, ventilation, and air conditioning functions. These technologies enable real-time monitoring and predictive maintenance, reducing energy consumption while enhancing operational efficiency. This approach aligns perfectly with Vision 2030's sustainability objectives, which emphasize carbon footprint reduction in urban development. Government support through subsidies and tax incentives for energy-efficient projects makes smart building technologies more accessible to developers and investors. Major developments across Riyadh, Jeddah, and Dammam are incorporating these advanced systems, with NEOM's cognitive city infrastructure setting new benchmarks for AI-driven energy management. The convergence of technology and sustainability is creating a robust ecosystem where smart buildings become the standard rather than the exception, driving continuous innovation in construction methodologies and operational practices.

Another transformative factor reshaping the market is the widespread adoption of prefabricated and modular construction techniques. These methods involve manufacturing building components in controlled factory environments before transporting and assembling them on-site, offering substantial advantages in construction speed, material waste reduction, and quality control. The approach proves particularly valuable given Saudi Arabia's rapid urbanization and the Kingdom's ambitious housing goals under programs like Sakani, which targets affordable housing development. Prefabricated buildings can be designed to meet stringent green building standards, incorporating energy-efficient systems and sustainable materials that contribute to reduced energy consumption and enhanced environmental sustainability. Major contractors are increasingly turning to modular construction for large-scale projects, with techniques like 3D printing and zero-emission machinery being deployed across giga-projects. The method not only accelerates project timelines but also ensures consistent quality and performance, making it an attractive option for developers seeking to balance speed, cost, and sustainability in their construction portfolios.

An emerging trend driving substantial market growth is the government's unwavering commitment to sustainability through policies and regulatory frameworks. Vision 2030 has established energy efficiency as a national priority, with the Saudi Building Code mandating energy-saving features in all new construction. The Ministry of Municipalities and Housing's Sustainable Building Program introduced the Building Sustainability Assessment System, a national rating framework that classifies projects from Green to Diamond based on sustainability criteria. By the end of 2024, 75 projects covering approximately 47 million square meters were evaluated under this system, representing a 32% increase over the previous year. The momentum continued into Q1 2025, with an additional 7 million square meters assessed, marking a 64% year-on-year increase. According to PwC's CEO Survey, nearly one-third of Saudi executives now view climate change as a major concern, with 60% focusing on enhancing energy efficiency. Government incentives, including tax breaks and subsidies for green building projects, combined with mega-developments like NEOM prioritizing renewable energy and zero-carbon infrastructure, are creating a favorable environment for market expansion. The Saudi Green Initiative, backed by over SAR 705 billion in sustainable materials investment, further reinforces the Kingdom's position as a regional leader in energy-efficient construction.

Saudi Arabia Energy-Efficient Buildings Industry Segmentation:

The report has segmented the market into the following categories:

Material Insights:

• Glass Wool
• Mineral Wool
• (EPS)
• (XPS)
• Cellulose
• (PIR)
• (PUR)
• Others

End Use Insights:

• Residential
• Commercial

Regional Insights:

• Northern and Central Region
• Western Region
• Eastern Region
• Southern Region

Competitive Landscape:

The competitive landscape of the industry has also been examined along with the profiles of the key players.

Recent News and Developments in Saudi Arabia Energy-Efficient Buildings Market

• January 2026: Saudi Energy Efficiency Center rolls out AI-driven Building Management Systems in Riyadh towers, slashing energy use by 25% through real-time HVAC optimization and predictive analytics, aligning with Vision 2030 sustainability mandates.
• October 2025: Tarshid retrofits Yanbu University with smart lighting and motion sensors, cutting electricity by 16% across 13 buildings while integrating solar PV panels for 30% on-site power generation.
• September 2025: Green building codes mandate Phase-Change Materials in new Jeddah projects, reducing cooling loads by 35% in extreme heat via thermal storage tech supported by SEEC incentives.

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