How Genuine is Saudi Arabia’s Commitment to Renewable Energy?

Christopher Zenios18/10/20193min
The largest project involving solar panels costing $200bn was announced in March last year and was declared “a huge step in human history”. This project was later cancelled in October.

The ambitious schemes touted by Saudia Arabia in the past decade, frequently do not work out according to analysts, with the above example being just one of many. It is all too often that an attention-grabbing announcement is declared but with little action to follow, meanwhile, the country’s fossil fuel consumption grows.

Only recently has a tolerance to renewable energy been seen, as in previous years, middle eastern oil companies would openly speak about the threat of renewable energy on their business. Glada Lahn, a senior researcher at Chatham House comments:

Back even in 2010, you couldn’t talk about the energy transition or playing a positive role in climate negotiations in those countries,

What is the motivation for middle eastern countries to reduce resistance? Saudi Arabia uses a large amount of renewable energy to substitute oil and gas, however as the population of the kingdom uses less oil and gas this means there is more to sell abroad. Renewable energy also results in more jobs.

Saudi Arabia has made positive steps towards meeting targets, for example, the kingdom has tripled its renewable energy target and plans large scale wind and solar energy projects.

So why the question of commitment and interest in renewable energy?

Despite these targets over the past decade, Saudi Arabia’s oil production has increased to 2m barrels a day. The United Arab Emirates, which lead the Arab Gulfs’ renewable energy, have increased oil production by 800,000 barrels a day over the past decade.

Homayoun Falakshahi, an oil and gas equity analyst at the energy intelligence firm Kpler comments:

“You always have that paradigm between what the governments [in the region] say in terms of energy policy – that they want to get away from oil dependence, for environmental as well as for financial reasons – and what they do. In practice, they are actually increasing their production capacity and putting out tenders for more work to be done in their oilfields.”

Other recent green energy projects include the announcement of a major investment in solar energy from Emirates flight catering.

Christopher Zenios

Christopher has always been a pioneer, a first adopter when it comes to technological advancements. Over the years, his expertise surrounded the real estate and digital markets and their evolution in today's society. After being the editor to various professional business news portals and blogs, he was selected to become the chief editor for HWC. Contact Christopher at +357-22029786 ext: 6110 or by email at [email protected] for editorial related questions.

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