Question

Tuki Mohammed Al-Shehri is head of Saudi Arabia’s Renewable Energy Project Development Office. London: In an exclusive interview with Arab News, Turki Mohammed Al-Shehri explains how an expanding renewables industry will boost employment as well as pave the way for a greener future. *** Crown Prince Mohammed bin Salman unveiled plans to develop the world’s biggest solar power project for $200 billion. A massive investment drive in green energy projects across Saudi Arabia is about creating jobs as well as diversifying the energy mix away from oil, according to the Kingdom’s renewables chief. Last week Saudi Arabia revealed ambitious plans to produce 200 gigawatts of solar power by 2030, helping the country become a leading exporter of sustainable energy. In an exclusive interview with Arab News, Turki Mohammed Al-Shehri, head of Saudi Arabia’s Renewable Energy Project Development Office (Repdo), said jobs and “local content” are guiding principles of the Kingdom’s renewables program. “A fundamental cornerstone of these projects will be local content. Local content is key — it is being stipulated in tenders,” said Al-Shehri in an interview in London. He said: “The idea is that the products and components that are used in these farms (turbines, panels, hoists and other parts) are brought in from local factories, and the idea is to grow the industry organically; we want local factories to also export outside the Kingdom, ensuring the creation of jobs, and this will make sure that everything that is built in the Kingdom will be on a competitive global basis.” Al-Shehri told Bloomberg in January that eight renewables tenders would be issued this year for 4.125 gigawatts of capacity at a cost of between $5 billion and $7 billion. Asked by Arab News if the Kingdom would also need foreign investment to develop the sector, Al-Shehri replied: “Due to the size of the projects, we do need foreign investment experience and know-how, yes.” In terms of the nuts and bolts of how renewable tenders would work, he pointed to the example of Riyadh-based Acwa Power, which recently won the contract to build the Kingdom’s first utility-scale solar photovoltaic plant. “As long as they meet our local content requirement of 30 percent as well as other stipulations, where and how they source the technology is up to them,” he said. “The objective is to have an economic energy mix, driven by low-cost energy, and to ensure that local competitive industry is created in the Kingdom.” By building up solar and wind-power generation, KSA will free up oil reserves for export, strengthening the country’s balance sheet. Last week Crown Prince Mohammed bin Salman unveiled plans to develop the world’s biggest solar power project for $200 billion in partnership with Japan’s SoftBank. The memorandum of understanding aims to produce up to 200 gigawatts of power by 2030 — about 100 times the capacity of the current biggest projects. If built on one site, the solar farm would cover an area twice the size of Hong Kong, according to a Bloomberg News calculation. Acwa Power CEO Paddy Padmanathan, who along with Al-Shehri attended London’s recent Saudi-UK CEO Forum, said: “Personally, I think they (renewables) could make up 40 percent of the (KSA) energy mix in 2030.” Turning to his company’s success in February, 2018, of being awarded the 300-megawatt PV solar project in Sakaka, Padmanathan said: “The tender was a rigorous, transparent process at a new world-record tariff and will set the foundation for a robust and competitive market for renewable energy in the Kingdom.” The 25-year Sakaka power purchase contract was awarded to Acwa at a new world-record tariff of 8.781 halala/kWh (per kilowatt hour) (2.3417 cents/kWh). Middle Eastern oil producers are looking to renewables to meet growing domestic consumption and would rather export as much oil as possible to generate income to meet internationally recognized green energy standards, such as those in the Paris climate accord, while also reducing reliance on fossil fuels. Saudi Arabia wants to deploy more natural gas, as well as solar and wind, to reduce its dependence on oil-based power generation. Developing a renewable energy industry is a key plank of Saudi Vision 2030. The Sakaka plant, which Acwa has already started constructing in Al-Jawf province, is backed by a 25-year power purchase agreement with the Saudi Power Procurement Company. Last year the Kingdom also tendered a 400 megawatt wind project — its first — at Dumat Al-Jandal, for which Repdo prequalified a number of companies in 2017. In a recent interview with Arab News, Adnan Amin, director-general of the International Renewable Agency, said renewables were incredibly cheap now. “The latest bids for Saudi solar projects are around 2.5 US cents per kWh, which is about a quarter of the cost of oil,” he said. Victoria Cuming, head of policy covering Europe, Middle East and Africa for Bloomberg New Energy Finance (BNEF), told Arab News: “Looking at the MENA region as a whole, renewables should both replace fossil fuel and add to the mix, as electricity demand will double by 2040, according to BNEF forecasts.” She expected the region to see a significant shift in the capacity mix, from being 93 percent fossil fuels today to just under half renewables in 2040, according to BNEF’s New Energy Outlook 2017. Cuming said: “In the near term, this will be mainly driven by incentives such as auctions, but in less than a decade the shift will be driven by the economics. Utility-scale PV plants are already cheaper than combined-cycle gas plants in net importing countries such as Egypt.” Provided governments continue to phase out fossil-fuel subsidies, “this will be the case across MENA by 2025. Ten years later, onshore wind farms will be cheaper than gas,” said Cuming.

1. ^{Discuss how renewable energy sector can grow organically. What are the benefits to Saudi Arabia.}

^{2- Conduct SWOT analysis for ACWA.}

Answer 1

1.Saudi Arabia recently tripled its renewable energy target and has successfully tendered for large-scale projects in wind and solar energy. Yet alongside this, over the past decade, Saudi Arabia has increased its oil production by 2m barrels a day.

output from renewables, especially solar and wind, is growing faster than anticipated, threatening to displace oil, gas and coal as the world's main sources of power. ...

Benefits

Advantages of renewable energy

Using renewable energy over fossil fuels has a number of advantages. Here are some of the top benefits of going green:

Renewable energy won’t run out

Renewable energy technologies use resources straight from the environment to generate power. These energy sources include sunshine, wind, tides, and biomass, to name some of the more popular options. Renewable resources won’t run out, which cannot be said for many types of fossil fuels – as we use fossil fuel resources, they will be increasingly difficult to obtain, likely driving up both the cost and environmental impact of extraction.

Maintenance requirements are lower

In most cases, renewable energy technologies require less overall maintenance than generators that use traditional fuel sources. This is because generating technology like solar panels and wind turbines either have few or no moving parts and don’t rely on flammable, combustible fuel sources to operate. Fewer maintenance requirements translate to more time and money saved.. Renewables save money

Using renewable energy can help you save money long term. Not only will you save on maintenance costs, but on operating costs as well. When you’re using a technology that generates power from the sun, wind, steam, or natural processes, you don’t have to pay to refuel. The amount of money you will save using renewable energy can vary depending on a number of factors, including the technology itself. In most cases, transitioning to renewable energy means anywhere from hundreds to thousands of dollars in savings.

Renewable energy has numerous health and environmental benefits

Renewable energy generation sources emit little to no greenhouse gases or pollutants into the air. This means a smaller carbon footprint and an overall positive impact on the natural environment. During the combustion process, fossil fuels emit high amounts of greenhouse gases, which have been proven to exacerbate the rise of global temperatures and frequency of extreme weather events.

The use of fossil fuels not only emits greenhouse gases but other harmful pollutants as well that lead to respiratory and cardiac health issues. With renewable energy, you’re helping decrease the prevalence of these pollutants and contributing to an overall healthier atmosphere.

Renewables lower reliance on foreign energy sources

With renewable energy technologies, you can produce energy locally. The more renewable energy you’re using for your power needs, the less you’ll rely on imported energy, and the more you’ll contribute to U.S. energy independence as a whole.

2.HTF MI recently introduced Global Clean Energy Market study with in-depth overview, describing about the Product / Industry Scope and elaborates market outlook and status to 2023. The market Study is segmented by key regions which is accelerating the marketization. At present, the market is developing its presence and some of the key players from the complete study are Kior, Elevance, ACWA Power, MEIL, Godawari, Abengoa, Amyris, ClearFuels, Sapphire Engry, Solazyme, Solena Fuels, RioglassSolar, ZKTeco, Acciona, ACSCobra, Sener, TSK, Brightsource, GE & SolarReserve etc.

Competitive Analysis:
The key players are highly focusing innovation in production technologies to improve efficiency and shelf life. The best long-term growth opportunities for this sector can be captured by ensuring ongoing process improvements and financial flexibility to invest in the optimal strategies. Company profile section of players such as Kior, Elevance, ACWA Power, MEIL, Godawari, Abengoa, Amyris, ClearFuels, Sapphire Engry, Solazyme, Solena Fuels, RioglassSolar, ZKTeco, Acciona, ACSCobra, Sener, TSK, Brightsource, GE & SolarReserve includes its basic information like legal name, website, headquarters, its market position, historical background and top 5 closest competitors by Market capitalization / revenue along with contact information. Each player/ manufacturer revenue figures, growth rate and gross profit margin is provided in easy to understand tabular format for past 5 years and a separate section on recent development like mergers, acquisition or any new product/service launch etc.