Saudi Arabia going green with new $1.5 billion energy plan

January 30, 2019 1:01 pm

Saudi Arabia has taken a step forward in its ambitious plans to create a global hub of renewable energy.

The kingdom announced the start to the second phase of its Renewable Energy Initiative by inviting expressions of interest in seven solar projects. These solar projects will be tendered by mid-2019 and are expected to attract $1.5 billion, according to the Renewable Energy Project Development Office (REPDO) of the country’s Ministry of Energy, Industry and Mineral Resources (MEIM).

The seven new solar projects will generate 1.5 GW of power – enough to run 226,500 homes.

This is a step towards Saudi Arabia’s goals to achieve more than 60 gigawatts (GW) of renewable energy generation through the next decade, with a planned 40GW to be generated from solar energy and 16GW from wind farms. The kingdom hopes to hit the milestone of 25GW in wind and solar power generation within the next five years.

The second phase of Saudi Arabia’s renewable energy push is expected to create more than 4,500 jobs in operations, construction and maintenance with solar projects planned at Qurrayat, Rafha, Alfaisaliah, Rabigh, Jeddah and Mahad Duhab.

Although the kingdom has been pushing for renewable energy, some analysts point to a stop-start gap between planning and implementation.

Building a future on renewable energy

Saudi Arabia, a global leader in oil exports, is attempting to diversify its economy and reduced dependence on oil revenue – a major part of the kingdom’s Vision 2030 goal. With supply glut fears wreaking havoc in the oil markets, this gradual shift towards renewable energy investment could prove useful in the long run.

Read: “The investors gave us a vote of confidence”: Saudi Finance Minister

Last year, REPDO allocated tenders worth 700 MW of renewable energy generation, which includes the 300 MW Sakaka PV solar project – the first renewable energy plant build under Saudi King Salman’s renewable energy initiative.

Saudi Arabia has also made positive strides towards the development of nuclear energy. Earlier this month, the kingdom announced that five countries pitched for the establishment of two nuclear reactors after the nuclear project met the requirements of the IAEA. Nuclear energy could help the kingdom not only by creating jobs, but also in terms of desalination and in terms of managing heat.

At the World Future Energy summit in Abu Dhabi held in January 2019, Saudi Arabia’s Minister of Energy Khalid Al Falih announced 12 renewable projects to be tendered through 2019.

Earlier in January 2019, Saudi Arabia handed its $500 million Dumat Al Jandal utility-scale wind farm tender to a consortium led by EDF Energies Nouvelles and Abu Dhabi Future Energy Company.

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Anup Oommen
By Anup Oommen
Anup Oommen is a Business Editor at MediaQuest Corp. He has been a journalist for the last eight years and has extensive insight and expertise in international relations, macroeconomics, sports and financial news.