Saudi Arabia kicks off $50B renewable energy plan to break oil dependence
The Kingdom has announced the launch of more than 30 solar and wind projects as part of a plan to reduce its dependence on oil. (Pixabay)
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Saudi Arabia will develop 30 solar and wind projects over the next 10 years as part of its $50 billion program to boost power generation and cut its dependence on oil.
This was announced by Minister of Energy, Industry and Mineral Resources Khalid Al-Falih at the Saudi Arabia Renewable Energy Investment Forum (SAREIF) here on Monday.
The Kingdom will produce 10 percent of its power from renewables by 2023, he said.
“The Kingdom has been blessed with abundant hydrocarbon resources, vast wind, sun and land resources. Our pursuit of renewable energy will allow us to use these resources to their full potential and redefine our energy leadership,” he said.
“Our goal is clear. Under the national Renewable Energy Program, led by the Renewable Energy Project Development Office, we are pursuing one of the most ambitious renewable energy development program globally, installing 9.5 GW of wind, solar, and other technologies over the next six years,” he added.
“We are seeking for the Kingdom, in the medium term, to become a nation that develops, manufactures and exports the advanced technologies of renewable energy production,” he said.
“This is really transformational,” he said, suggesting that the changes coming to the Kingdom’s energy sector will be as significant as the discovery of oil in the 1930s.
“You’re really talking about a significant socio-economic transition that’s going to take place” over the next decade or two.
Falih said the energy sector is being completely restructured to include an autonomous board of regulators, and with privatized generation capacity.
He formally opened bids on the first 300-megawatt solar plant under the renewables plan.
The government has shortlisted 51 firms, most of them from abroad, for bidding on that plant and a 400-megawatt wind farm.
A tender will be offered in the fourth quarter for 400 megawatts of wind power at a project in the northern area of Domat Al-Jandal, said Falih, who is also the chairman of Saudi Aramco.
The energy minister also said that the government is planning to privatize the power industry.
Saudi Electricity will be restructured, with its generation, transmission and distribution businesses all operating independently, he said.
“There are no dates established yet, but the process has been moving and we are working on that,” Saudi Electricity’s Al-Shiha said on the sidelines of the conference.
Al-Falih said four generating companies under Saudi Electricity will be privatized. The Kingdom will create a new company to trade power locally and wants to sell electricity to other countries, he said.
The National Renewable Energy Program (NREP) plans to transform the Kingdom’s energy system by targeting the generation of 3.45 GW of renewable energy by 2020, under the National Transformation (NTP) and 9.5 GW by 2030, under Vision 2030.
The 3.45,2020 GW of renewable energy will be procured in three stages. The first round will involve 0.7 GW, followed by 1.02 GW and 1.73 GW of capacity sought in rounds two and three of the tender process.
“In the second round, we are going to start on many projects which we will start with 400 MW of wind and 620 MW of solar power. This project will come in the fourth quarter of this year. This will come in stages and will contribute to the second round.”
By Hanan Alnufaie
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