Saudi Arabia seeks to become major solar producer

May 27, 2012 12:00 AM

Saudi Arabia, the world’s top oil exporter, may finally be getting serious about overcoming the technical and financial hurdles for tapping its other main resource: Sunshine.
Thousands of solar power panels have sprung up across Europe over the past few years, thanks to generous subsidies that make the technology an attractive alternative to conventional energy.

Saudi Arabia too, wants to generate much more solar power as it lacks coal or enough natural gas output to meet rapidly rising power demand. Doing so would allow it to slash the volume of oil it burns in power plants bankrolled by billions of dollars worth of saved oil earnings.
“At world market prices, solar is competitive if you use crude oil to generate electricity,” said Maher Al Odan, a senior consultant at King Abdullah City for Atomic and Renewable Research (KA-CARE) which was set up to plan Saudi Arabia’s energy mix.

Saudi Arabia has said it wants to become a major solar producer before, but its investments amount to much less than 50 MW versus several countries which have added thousands of MW a year.
This month, KA-CARE set forth a much more ambitious plan, recommending that the kingdom aim to get more than a third of its peak-load power supply, or about 41 gigawatts (GW), from the sun within two decades at an estimated cost well over $ 100 bn.

Making the plan work economically rests on three assumptions: that technology improvements will cut costs, that a domestic solar industry will emerge and create jobs for a booming population, and that many billions of dollars worth of exportable oil will be saved.
An average of 700,000 bpd of crude were used in Saudi power stations during the peak air-conditioning demand period from May to September last year, according to official data supplied to the Joint Organisations Data Initiative (JODI).

Although a rise in gas production should temper crude burning this summer, it will likely rise substantially in years ahead unless alternatives are found, and fast.
“Domestic oil consumption is rising very rapidly and you get far more value for oil if it’s exported than if it’s consumed domestically,” said Paul Gamble, chief economist at Jadwa Research in Riyadh.

KA-CARE said the first two solar plants, with combined capacity of 3 GW, might be put to tender in the first quarter of next year. One of these will use concentrated solar power (CSP), which Riyadh says could supply an eventual 25 GW of the total 41 GW of planned solar capacity.
The other will use photovoltaic (PV), the technology expected to meet the rest of the overall goal.

CSP is relatively new and much more expensive than PV. But unlike PV, it can store solar energy for several hours, which is a big advantage in a country where air conditioning demand remains high in summer long after the sun has gone down.
Both technologies will suffer efficiency losses in Saudi Arabia’s harsh, arid conditions, but long periods of intense sunshine should help compensate.

Another problem could stem from desert dust that can reduce solar energy by 10-20 % in efficiency, according to King Fahd University of Petroleum & Minerals.
KA-CARE plans to pick the best technology currently available around the world and develop it further and sees most scope for this in the comparatively immature CSP market.

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