Saudi Arabia is planning to embark on a renewable energy spending spree to help meet rising electricity demands and curb its dependence on crude oil. The Saudi government is set to unveil this new renewable-energy strategy at a conference in Riyadh on April 3, reports Bloomberg.
Persian Gulf oil producers need to increase electricity output to sustain the region’s 10% annual economic growth rate. However, countries in the region are also looking for new ways to generate power, thus helping them maximise income from oil exports.
“Fuel supply is one of the major challenges facing the power sector and the nation,” Saleh Al-Awaji, Saudi Arabia’s deputy minister for electricity at the Ministry of Water, said at a conference in Abu Dhabi on March 28. “The policy is to work intensely on saving energy and making sure every barrel of oil that can be saved is, and is made available for export.”
Current electricity generating capacity stands at 45,000MW and this will need to rise to 120,000MW by 2030 if Saudi Arabia is to maintain its position as OPEC’s leading oil supplier. To expand capacity and the electricity grid, the country will need to invest more than US$100 billion over the next 10 years, with a third of that going towards renewable and non-renewable energy power plants.
In February, Saudi Arabia reached an agreement with France to cooperate on developing nuclear energy and also announced that it would be looking to develop its solar, geothermal and wind energy sectors. Officials from the King Abdullah City for Atomic and Renewable Energy, the agency in charge of promoting alternative energy, are expected to announce guidelines and targets for solar at the Riyadh conference.
“I’m expecting they will announce the target to generate 20% of their electricity from renewables by 2030,” Paddy Padmanathan, CEO of private Saudi electricity provider ACWA Power International, said. “Saudi Arabia can support a huge amount of solar generation, with the country’s combination of sun and the load profile.”
This latest development comes just a few months after Saudi Aramco revealed it was planning to build a 3.5MW solar park on the outskirts of Riyadh.