The future of cleaner and renewable energy in Saudi Arabia

 

  

Saudi Arabia's sustainable energy vision, strategy and execution roadmap form together, potentially, the cornerstone for energy sustainability for the region, and beyond.

 

We believe that creating a better future for our children and grandchildren, in Saudi Arabia and, indeed, everywhere else in the world, mandates that we all strive to create a workable energy future for all; an energy future that I personally believe has several very distinct characteristics:

 

1. First, it has to be a collective effort,

2. Second, that energy future must be widely accessible,

3. Third, it has to be affordable,

4. Fourth, it must be sustainable, and

5. Fifth, it must be the result of optimization, in a relevant large context.

 

These attributes are exactly what characterize King Abdullah's Vision for the future energy ecosystem of Saudi Arabia, that culminated in the creation of King Abdullah City for Atomic and Renewable Energy (K.A.CARE).

 

However, these attributes are universally desirable.

 

 

 

From the outset, we embarked on formulating an energy future for Saudi Arabia that is both interlinked and dynamically responsive to the regional as well as the global energy ecosystems, starting with the GCC region, the MENA region, and then the EUMENA region.

 

Our value proposition is one of working together, and is built upon an economically viable solution for all. Working together is truly in the best interest of the Saudi energy future, as well as for the energy future of all.

 

The key challenge that the Saudi electricity sector faces is that during the offseason, in winter and parts of the spring and fall, 45% of the installed generation capacity remains idle. This is because cooling constitutes the largest single component of electricity demand, amounting to more than 50% during peak season, and significantly decreases during the offseason.

 

That means that by 2030, when the peak demand will reach 100 GWs, a whopping 45 GW of installed capacity, at least, will remain idle.

 

One approach to tackling this issue is to deploy technologies that peak during the peak season and reduce their output during the off season. Solar energy has this very characteristic, and is an excellent candidate to mitigate part of this challenge. Yet, it cannot do it on its own.

 

Therefore, we have explored the potential of exporting electricity from the dormant capacity during our offseason to countries whose peak demand coincides with our low demand season. Our studies showed that grid investments required to wheel electricity generated in Saudi Arabia to the European Union does not exceed 18% of the total investment required to install the generating capacity.

 

If such a strong interconnection is realized, the overall economic benefits are stark and compelling. If we, collectively, reduce the need to install generation capacity by, say, 10-20% with the ability to trade energy collectively, the savings are tremendous.

 

Energy trading is only one facet of energy cooperation, but is a very important one.

 

This is the vision of DESERTEC and we, in Saudi Arabia, are in a position to anchor this vision and bring it to realization, in partnership with all.

 

 

 

Practically speaking, there is no location on earth that has no supply of renewable energy; it is only a matter of properly and economically harvesting, transmitting and connecting.

 

This is a fundamental premise of profound implications: Energy, in some form or another, is abundantly available in its raw nature, be it sun rays or wind gusts or ocean currents.

 

 

 

Sunshine is basically cost-free. Yet, if a country does not develop its own solar energy harvesting systems, or a significant part thereof, that country would essentially be importing solar energy.

 

It is fortunate that it is not too difficult to make energy harvesting systems affordable for all. This is primarily because a large part of the solar harvesting systems' cost is consumed in the service component of the value chain, including design, engineering, procurement, construction, assembly, operation and maintenance.

 

For Saudi Arabia, our analysis showed us that we can localize more than 85% of the overall value chain of renewable energy capacity deployed in Saudi Arabia over the next 20 years.

 

 

 

It is natural to think of sustainability as synonymous with the basic concepts of:

 

 Environmental stewardship

 Human development , and

 Economic viability

 

But sustainability means much more than that.

 

- If local value chain development is done properly, sustainability here means "security of supply".

 

- It also means efficiency and conservation, since both can be considered the zeroth-order renewable energy.

 

- It also means that it is an enabler of other sectors' development. For example, renewable energy can play a very important role in making water desalination sustainable for countries with no fresh water sources.

 

 

 

For Saudi Arabia, as for many other nations, renewable energy, on utility scale, is a new strategic sector. The opportunity presents itself to maximize and smartly optimize economic development.

 

One glaring conclusion is clear: no single energy solution fits all situations.

 

However, it is not uncommon to hear strong advocacy of one particular generation technology vis à vis others. This advocacy may very well be good-intentioned.

 

 

 

The proposed "2050 Desert Power" document reports the forecasted cost of electricity for the EUMENA region. However, the technology solutions proposed grouped solar and wind generation technologies together.

 

I believe this merits a revisit. Since wind technology is practically mature, huge cost reductions in CAPEX is not much expected over the next 30 years. If we add to that the fact that high potential wind sources locations are limited. This will surely mean that once the best suitable locations for wind harvesting have been occupied, the cost of generating electricity from wind will increase, as is actually shown in the report.

 

This is not the case, I believe, for solar energy. The solar resource quality in the solar belt spanning all of the MENA region is rather uniform, and it is among the best in the world. Coupled with this favorable resource condition is the fact that CAPEX of both solar PV and solar CSP is decreasing rapidly, which means that the more terawatt hours one generates from solar energy, the less the cost of electricity would be.

 

This is in no way a vote of no confidence in wind. Quite the opposite, for I believe that wind technology, especially in our part of the world, lends itself most favorably for coupling with water desalination requirements. The demand on desalinated water is volume-dependent and not time-dependent. And the desalination process boasts of inherent storage feature thereby allowing for wind energy harvesting to take place whenever wind blows across the blades, with hardly any need for active load management or additional storage, that otherwise would have been required for grid stability if wind was to be used for the conventional utility application.

 

Turning back again to Saudi Arabia: K.A.CARE was tasked by the Saudi government to introduce renewable and nuclear energy, sustainably, to the Saudi energy landscape, in partnership with other key stakeholders in Saudi Arabia, and beyond.

 

It is estimated that Peak demand in Saudi Arabia will exceed 120 GWs in 20 years.

 

However, factoring in the need for respectable operating reserves may keep the required installed generation capacity greater than 120 GWs by 2032.

 

As I mentioned earlier, the key challenges that the Saudi electricity sector faces are the 45% idle installed generation capacity during the off season, and that cooling constitutes 50% of electricity demand during peak season.

 

 

Given all those realities and the need for sustainable and economically viable solutions, the comprehensive proposed solution for Saudi Arabia calls for producing 50% of the total energy generated in Saudi Arabia by 2032, in terawatt hour, from non fossil sources, namely nuclear and renewable energy, thereby reducing total hydrocarbon consumption in the power and desalination sectors by 50% in 20 years.

 

The total generation capacity that this scenario calls for is to connect to the grid in 20 years 54 GWs of renewable capacity, composed of 41 GWs solar, 9 GWs wind, 3 GWs waste-to-energy, and 1 GW geothermal.

 

The Royal Vision ensures that the Kingdom of Saudi Arabia will continue to be the strong player in energy production and reliable partner in providing energy to future generations.