Saudi Arabia is not known for thinking small. So when the oil-rich Kingdom announced a new initiative to expand the production of renewable energy, it laid out plans for what could become the most sweeping renewable energy undertaking in the world.

GLOBE-Net, May 14, 2012- Saudi Arabia is not known for thinking small. So when the oil-rich Kingdom announced a new initiative to expand the production of renewable energy, it laid out plans for what could become the most sweeping renewable energy undertaking in the world.

The King Abdullah City for Atomic and Renewable Energy (KACARE) will begin implementation of the Kingdom's solar energy strategy this year, with the goal to save up to 520,000 barrels of oil per day by 2032.

Deputy President of KACARE Walid Abu Al-Faraj, who spoke at a recent Solar Energy Forum in Riyadh, said KACARE plans to make a big shift in the Kingdom by converting it into a country with sustainable energy system that will hopefully boost the strength of its national economy, but also accelerate the shift toward a cleaner economy.

Saudi Arabia needs to install much more solar power than any other country has managed to do so far, while simultaneously developing more nuclear power plants.

Prince Saud bin Abdullah bin Thunayan, president of the Royal Commission for Jubail and Yanbu (RCJY), said the Kingdom's oil wealth is set to deplete and it is necessary to find other sources of alternative energy.

The Prince stated that an important component of this challenging goal requires a number of studies on how to remove the current obstacles facing the production and storage of renewable energy, notably solar energy.

Based on some reports, world investments in solar energy amounted to $136 billion in 2011 and produced 65 gigawatts (GW) of electricity. However, production is modest compared to the world's growing need that is increasing by 2 percent per year.

The energy strategy in the Kingdom is based on the development of alternative and sustainable energy by encouraging both public and private sector firms to carry out studies and projects in the solar energy industry, the RCJY chief said.

KACARE believes Saudi Arabia should aim for around 41 GW of solar production by 2032, enough to produce about a third of the country's energy demand. Of this, 25 GW should be from concentrated solar power (CSP) while the remaining 16 GW should be from solar photovoltaic (PV).

KACARE also believes the country must develop 21 GW worth of nuclear power, roughly one sixth of its 2032 anticipated energy need. The remaining energy demand should be met from oil and gas.

KACARE holds that nuclear remains the best way of generating 'baseload' electricity. According to data collected by the World Nuclear Association, the 21 MW of nuclear energy which the country is pursing would mean more reactors would be built in Arabia than in any country other than China, Russia, the USA and India.

Peak Oil or Peak Cash?

While the move to renewables is significant in itself, the more pressing priority focuses on preserving the Kingdom's wealth, which at present is based on its dwindling fossil fuel endowment.

Energy and water conservation are two high priority issues in Saudi Arabia, but conserving energy would not lower the nation's exploitation of its fossil fuel resources.

As noted by energy expert Paul Gipe, "Every kilowatt-hour generated with renewables is a kilowatt-hour that doesn't have to be generated with natural gas or oil, leaving more to sell on the international market. This would only be important to the Saudis if they realized--at some level--that there were finite limits to oil and gas in the kingdom."

With oil trading at over $100 per barrel, the avoided cost of offsetting the use of fossil fuels--the "opportunity cost," as the Kingdom's consultants call it--is already much higher than the cost of solar power today, justifying the huge undertaking, notes Gipe.

If Saudi Arabia becomes "The Kingdom of Sustainable Energy" it would send a powerful message to other energy rich jurisdictions around the world not to place all their energy eggs in one basket.