Why Saudi Arabia Is Building The LARGEST Solar Energy Park | That Changes The Entire Energy Industry
#saudiarabia #energy #solar
Saudi Arabia is building a huge solar power plant in the Al Shuaibah region that will provide electricity to around 350,000 homes in the Middle East.
The Saudi utility company ACWA Power and the Water and Electricity Holding Company are developing the project. What's more, power purchase agreements have already been signed.
It's expected to start operating in the fourth quarter of 2025 and will have a capacity of 2,060 megawatts.
The Water and Electricity Holding Company and ACWA Power will jointly own the project. Then, a new entity called Shuaibah Two Electrical Energy Co. will oversee its construction.
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When we think of Saudi Arabia, the first thing that comes to mind is its huge oil reserves. But the world is changing, and the future of oil is becoming less certain.
There’s been a rise of electric vehicles and a shift towards sustainable alternatives in shipping and aviation. So, it's clear that Saudi Arabia needs to adapt to this new energy landscape.
In the first half of 2021 alone, electric vehicle sales increased by 168% compared to the same period in 2020.
This indicates that the world is still moving toward a cleaner and more sustainable future despite the challenges of the Covid-19 pandemic.
In addition, major oil companies and the International Energy Agency predicted that global oil demand would peak sometime after 2030.
This means that Saudi Arabia can longer rely on oil as the foundation of its economy in the long term. Instead, the kingdom needs to turn toward renewable energy sources.
This is why the country has set ambitious targets for developing renewable energy. This includes plans to generate 50% of its electricity from renewable sources by 2030.
Different countries start the energy transition from other points. Some countries, like Germany, China, and the United States, have abundant coal resources, so they rely on coal-fired generation.
In contrast, Saudi Arabia has abundant oil resources, so it has been using oil as a power source. However, the country has been reducing its use of oil in electricity generation and replacing it with natural gas.
In the past decade, gas-fired generation doubled to over 200 terawatt-hour in 2020. Meanwhile, oil-fired generation has fallen by 28% from a peak of 183.7 terrawatt-hour in 2015 to 132.8 terrawatt-hour in 2020.
