Saudi Arabia is making a remarkable shift to renewable energy and a green future. The oil producing giant is aiming to become sustainable with a dedicated government thrust on futuristic goals including the focus on Hydrogen. Notably, among the renewable energy growth indicators, Saudi Arabia is one of the top performers across the globe in the past two years.

Recently, the Ministry of Energy informed that the Kingdom was ranked the top country in the Arab region and 20th overall for reducing CO2 emission growth. The feat was accomplished through the unique Saudi Green Initiative (SGI) that was launched in 2021. Since then, Saudi Arabia has climbed 10 positions in overall ranking under the Green Future Index. Coming to energy sector, SGI has led to creation of 17 renewable energy projects with capacity of 13.76 GW that helps cut 23.1 million tonnes of Carbon Dioxide emissions. Also, a Carbon-capture, usage and storage unit has been established with a capacity to produce 9 million tonnes of sequestered carbon annually. This is envisaged to be increased to 44 million tonnes of carbon annually by 2035.

Additionally, Saudi Arabia has set in motion the largest clean hydrogen production center in world with a capacity of 250 thousand tonnes per year by 2060. Under Crown Prince Mohammed bin Salman Al Saud’s vision, Saudi Arabia is expected to make a radical shift to sustainable economy in coming decades. Last year, the Crown Prince launched the Middle East Green Initiative, which aims to decrease carbon emissions from hydrocarbon production in the region by over 60 percent. Additionally, the initiative aims to reforest the Middle East by planting 50 billion trees and restoring an area equal to 200 million hectares of degraded land. The initiative is expected to result in a 2.5% decrease in global carbon levels. The goal of the initiative is to reduce more than 670 million tons of carbon dioxide equivalent, which is equivalent to the total amount of nationally determined contributions of all countries in the region, representing 10% of global contributions at the time of the initiative’s announcement. The initiative seeks to encourage regional collaboration and cooperation towards the reduction of emissions. After SGI 2030 plan, the Saudi renewable energy market is expected to register a Compound Annual Growth Rate (CAGR) of 13%+ during 2022-27. It is expected that the country will be meeting a third of its energy requirements from Solar power by the end of the decade. The Saudi Vision 2030 that was launched in 2016 to plan the future goals of the country envisioned a growth of non-oil revenue to the Kingdom from 16% to 50%.

The Saudi government has announced plans to construct 30 solar and wind power plants within the next decade, as part of a significant expansion strategy worth USD 50 billion aimed at reducing its reliance on oil by 2030. One such project, a 300-MW solar park, has already commenced construction in April 2021 by a consortium consisting of Masdar, EDF Renewables, and Nesma, after securing financing. The consortium won the national procurement round by offering SAR 60.9042 per MWh for the project, which is located approximately 50 km from Jeddah city and is slated to become operational in 2022. The restructuring of the Saudi Arabian economy, aimed at moving away from oil dependency, will dominate the Kingdom’s growth till 2030.

While Oil is certainly going to stay as the main plank of Saudi economy even after 2030, its domestic economy might look a lot different after 2030. The good news is that Saudis are doing their bit for climate sustainability. Just like the saying’ goes, “all good things start at home,” the Kingdom’s bit to diversify its oil-dependent economy to reach high sustainability is an effort that should be looked closely by other oil-producing countries. These efforts demonstrate Saudi Arabia’s commitment to a more sustainable future and have earned recognition from the international community.

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