To help address its energy needs, last week Saudi Arabia announced plans to incentivize both private and public investments in energy sources other than oil.
Within 20 years, the Saudi royal family aims to invest $80 billion and $240 billion so that nuclear and solar, respectively, will each provide 15 percent of the kingdom’s power needs.
Last week, energy officials in Saudi Arabia announced plans to become a major nuclear energy state, assuring the reactors would be used only for peaceful purposes. They intend to move fast, beginning construction by year’s end.
The Saudi royal family hopes that nuclear will provide 15 percent of the Kingdom’s power (18 GWe) within 20 years, together with a similar 15 percent (40 GWe) from solar. They are planning to invest $80 billion to build more than a dozen nuclear power plants as fast as possible, intending for the first reactor to come online in only eight years.
Nuclear and solar are especially good for cogeneration of electricity and heat for desalination and have become central to Saudi Arabia energy strategy. With over 500,000 square miles of arid cloudless land, the kingdom is well suited to concentrating solar technologies. But renewables need a base load source like nuclear for support.
Energy consumption in Saudi Arabia is growing faster than any other country in the Middle East, and almost all of it is fueled by oil and natural gas. Total electricity consumption in Saudi Arabia exceeds 200 billion kWhs per year and is expected to double by 2030 according to a report by the Gulf Research Center.
The possible sites for these reactors include Jubail on the Persian Gulf and Rabuk and Jizan on the Red Sea. The reactors would power their own desalination plants for water.
Since Saudi Arabia burns almost a billion barrels of oil a year to produce electricity, this change in production is critical to their economic future. It is much more profitable to sell their oil and gas to China and the West instead of burning it for power.
The cost of the oil used to burn to produce electricity is heavily subsidized by the government, which increases waste and inefficiency and is detrimental to their overall GDP. Saudi officials are worried that the present trend of increasing oil use in the kingdom will hurt their economy in only a few short years, so this change is needed right now. The Oil Price said in a report transition is intended to happen quickly, with the first nuclear reactor expected to come online in only eight years.
