Saudi Arabia targets a cleaner future with $10 billion hydrogen investment and NEOM mega-project
Saudi Arabia might not be your first thought for an environmental powerhouse. It is home to roughly 17% of the world’s petroleum reserves, but it also has an elaborate environmental plan to reduce carbon emissions by 278 million tons per year by 2030.
Saudi & Middle East Green Initiatives (SGI) is steering the way to a cleaner future by supporting a number of clean energy initiatives – including a massive green hydrogen facility. Here’s everything you need to know about Saudi Arabia’s eco agenda.
What are the goals?
SGI predicts that Saudi Arabia will have a capacity for 100-130 GW renewable energy by 2030. It will achieve this by developing Saudi Arabia’s Energy Efficiency Program (SEEP) across power generation, water desalination, and electricity transmission and distribution.
Saudi Arabia also aims to have 50% of its power generated from renewable sources by 2030. A number of developments will be made to support this goal, mapped on the Green Initiatives website. One of these is the NEOM Green Hydrogen Project.
What’s hydrogen’s place in this?
The NEOM Green Hydrogen Project is under development in the Tabuk province, and is the world’s largest utility scale, commercially-based hydrogen facility. The facility will be able to produce 250,000 tons of green hydrogen annually by 2026, according to the SGI. It is the only green hydrogen facility on SGI’s map, but this doesn’t mean hydrogen doesn’t have its place in Saudi Arabia’s future.
The government is aiming for 48 gigawatt-hours (GWh) of battery energy storage systems (BESS) planned by 2030, which will store solar energy to enable 24/7 hydrogen production. Plus, the Public Investment Fund (PIF) plans to invest up to $10 billion in green hydrogen manufacturing facilities, according to the Saudi Green Initiative.
Saudi companies are getting on board with the shift too. ACWA Power signed a memorandum of understanding with German company SEFE Energy earlier this year to export 200,000 tons of green hydrogen annually by 2030.
What’s happened so far?
So far, Saudi & Middle East Green Initiatives has shared that the grid has a renewable energy capacity of 6.2 GW, and developments for 44.2 GW capacity are in the works. With projects currently under development, 7 million homes could potentially be powered by renewables in the future.
Saudi energy champions have been making major investments in the clean revolution. Aramco has shared plans to produce 11 million tonnes of blue ammonia annually by 2030 and ACWA Power is investing in a number of renewable projects. One of these is the MW Sudair solar plant, which will be able to supply 185,000 homes with renewable energy once completed.
What’s next?
Saudi Arabia has the potential to be a powerhouse for clean development – and especially, hydrogen.
The NEOM Green Hydrogen Project targets a production cost of green hydrogen at £1.64 per kilogram, which is well below the European average of £3.50-£14. If Saudi Arabia acts on the environment now, the future has the potential to be cleaner than ever before.
