Saudi Arabia's one more go at a national energy strategy
The emerging industry of renewable energy in the Kingdom cannot make it without a strong government intervention, regulatory, monetary and incentives engagement.
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Talks continue and will continue with respect to the yet-to-be-approved national energy strategy. When I started talking and writing about it more than two years ago, I never imagined that it would take that long for it to developed, reviewed, debated and yet-to-be approved. This is evident especially after knowing the importance of such strategy in maintaining the leadership status of Saudi Arabia in the world-energy map as the largest source of energy, whether fossil (oil and gas), as is the case at the present time or alternative and renewable energy, particularly solar in the long term.
Today, I would like to emphasis on the importance of the alternative energy strategy specially solar, nuclear, wind, biomass and thermal which is intended to play a complementing role to the existing successful national oil and gas strategy. The question remains: Who is responsible for the development of this strategy? Is it the Ministry of Petroleum and Mineral Resources, King Abdullah City for Nuclear & Alternative Energy, the Ministry of Water and Electricity knowing that the theme of this strategy revolves around the generation, transmission, and consumption of electricity, or the Ministry of Planning, which is entrusted to ensure the existence of strategic plans in all ministries that would eventually lead the Kingdom to a bright prospering future. Who is responsible and accountable for the existence, approval and implementation of this strategy? Furthermore, what is the role of some government institutions and private research centers such as King Abdulaziz City for Science and Technology, KAPSARC, KSA universities and oil companies in the development and implementation of such strategy?.
We must believe that time equals money when it comes to energy strategy and energy matters. Every day passes without implementing such a strategy specially the power efficiency, conservation and renewable generation parts, means more money wasted through the current inefficient use of valuable oil and gas.
To promote renewable energy in Saudi society, I had mentioned in previous articles the importance of eliminating some of the obstacles and challenges facing this yet-to-be-initiated industry which most are yet to be done. To support the development, growth and prosperity of the renewable energy industry in the next 10 years, until the completion of the industry’s infrastructure, the following must be developed and enforced: 1 - domestic governing legislation, 2 - incentive programs for private investment 3 - related materials custom’s waiver, 4 - government investment specially in supporting the private sector to make their investment profitable.
Although these actions, if done, will cost the government money, it will undoubtedly serve the long-term objective to strengthen the Saudi economy, increase the success probability of this industry and help the unemployment issue. Whatever oil and gas quantity saved through the implementation of this strategy can be included in this formula as a positive cash flow.
Government support of emerging industries is not new. As a matter of fact, the West and the East, including USA and EU, are applying this strategy not only to help strategic emerging industries to reach maturity but also with help mature strategic industries near bankruptcy. Simply, this emerging industry cannot make it without a strong government intervention, regulatory, monetary and incentives engagement.
If we consider the Kingdom's current low energy efficiency and low intensity resulting in a huge energy waste, then we can say that every day that passes without implementing this strategy means tens of millions of riyals simply wasted. Annually, this can be easily accumulated into several billions. The question is, shall we continue this waste or save and use this money to build the renewables’ industry infrastructure?
Finally, I suggested before, looking at the possibility of restructuring the Ministry of Petroleum and Mineral Resources and renaming it to Ministry of Energy responsible of the development, monitoring and implementation of the National Energy Strategy, including alternative and fossil based sources. It's an idea that I think eventually will serve this strategy.
— Dr. Sami Alnuaim is a Saudi writer. He can be reached at www.saudienergy.net and follwed on Twitter@neaimsa
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