Saudi Arabia’s Renewable Energy Drive to Save $30 Billion in Annual Electricity Costs by 2030

Arab Times News – May 10, 2024: Saudi Arabia’s ambitious transition from oil-powered electricity to renewable energy sources is projected to yield significant cost savings, according to a senior executive from S&P Global.

A Sustainable Renewable Energy Future

Sofia Bensaid, Director of Infrastructure and Project Finance Ratings at S&P Global, spoke at the 2024 Saudi Arabia Capital Markets Conference. During her speech, she highlighted the Kingdom’s commitment to renewable energy. Bensaid outlined Saudi Arabia’s ambitious goals: achieving 50% renewable electricity by 2030 and net zero emissions by 2060.

Cost Savings Through Renewable Energy Adoption

Bensaid highlighted that Saudi Arabia’s shift to renewable energy could lead to an annual reduction of approximately $30 billion in electricity costs by 2030. However, she also acknowledged the challenges associated with implementing the plan, particularly the need to add over 20 gigawatts of renewable energy capacity annually until 2030.

The conference also explored investment trends and the Kingdom’s broader economic diversification efforts. Rawan Oueidat, Director of Corporate Ratings at S&P Global, noted that national oil companies in the region are expected to continue investing heavily, albeit with a slower growth rate compared to previous years.

Vision 2030 and Financial Projections

Zahabia Gupta, Director of Sovereign Ratings at S&P Global, spoke at an event and emphasized the importance of Saudi Arabia’s Vision 2030 plan for social and economic transformation. Gupta highlighted the substantial costs associated with these projects, estimated to be around a trillion dollars or more.

Despite the significant debt issuance needed to implement Vision 2030 projects, Gupta said Saudi Arabia is expected to maintain a comfortable net asset position. She pointed out that prudent fiscal policies will help mitigate potential risks.

Continued Government Support for Vision 2030

Despite the challenges posed by increasing debt issuance, S&P Global expects that the Saudi government will continue to support Vision 2030 projects, with contributions from the private sector and foreign investors.

Saudi Arabia’s transition to renewable energy represents a pivotal step towards achieving sustainability and cost efficiency in its electricity sector. With robust government support and strategic investments, the Kingdom is poised to realize its ambitious vision for a greener and more prosperous future.

Read More News: Saudi Arabia and UK Forge Collaboration on International Development and Aid