When one of the world’s largest exporters of oil announces a $100 billion investment in renewable energy to reduce its own, domestic dependence on fossil fuel, the rest of the world needs to sit up and pay attention.
Saudi Arabia revealed plans to make just such an investment earlier this month, aiming to install a whopping 41 gigawatts of solar power — or 20% of the country’s needs — by 2032 while adding other alternatives including wind, nuclear, waste-to-energy and geothermal to its energy mix.
While the oil-rich nation has acknowledged the threat of global climate change, its push toward renewables is about more than carbon emissions.
Not only is demand for electricity growing in Saudia Arabia, but the country is dependent upon energy-intensive desalination plants for most of its fresh water — plants which currently consume millions of barrels of oil daily. On the scale now envisioned, solar would reduce national consumption by more than a half-million barrels per day.
Moreover, domestic consumption of oil is heavily discounted — in some cases, priced as low as $5/barrel, whereas that same oil on the world market could be sold at $100/barrel.
Looking beyond its own borders, Saudia Arabia also recognizes the economic and employment opportunities in becoming a major player in the global solar industry, and aims to develop its own supply chain and manufacturing facilities.
As if to demonstrate how serious the Saudi’s are about their alternative energy strategy, solicitation of bids for the first phases of implementation will begin immediately.
An abundance of sunshine makes Saudi Arabia one of the world’s most attractive locations for solar development, and its particular form of government makes aggressive, top-down initiatives easier to implement than in western democracies. Those facts, combined with the economic benefits of cutting highly-subsidized domestic consumption while creating jobs, certainly put the country in a unique position to move forward with ambitious strategies for developing alternative energy.
Nevertheless, when an oil-rich nation recognizes that the time for massive investments in renewable energy is now, it makes populist slogans such as “drill here, drill now” sound like something out of the last century.