Saudi Arabia will form a company to buy power from generators of renewable energy and to cover any cost difference between the purchase and sale prices, according to an official who has a hand in shaping the policy.
The world’s largest crude oil exporter will present a national policy statement on renewable and nuclear power generation this year as it seeks to diversify energy resources, said Khalid Al Sulaiman, vice president at the King Abdullah City for Atomic and Renewable Energy.
“There will be an offtaker and the offtaker will sell to a distribution company,” Al Sulaiman told reporters at a conference in Abu Dhabi today. “That offtaker will have to pay the difference between the cost of the electricity and the price the distributor pays.”
Saudi Arabia plans to attract about $109 billion in solar investments to generate a third of its electricity by 2032, or about 41,000 megawatts. It currently has about 3 megawatts of solar installations, trailing Egypt, Morocco, Tunisia, Algeria and the U.A.E., according to Bloomberg New Energy Finance.
Ka-Care, as the organization is known, is charged with reducing the country’s reliance on burning crude or fuel oil for electricity generation. That would also benefit the environment cutting carbon emissions while also saving oil for export, Al Sulaiman said.
Saudi policy makers will also consider the value of cutting emissions and the opportunity cost of burning valuable crude at home, Al Sulaiman said. That would encourage officials to “monetize” the benefits of renewable energy, he said.
Currently, the State-owned Saudi Electricity Co. (SECO) is the country’s current electricity distributor, meaning it buys power from generators and sells it residents. A so-called offtaker would buy power from renewable generators before selling it to the distributor.
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