Saudi Arabia is gearing up for a major solar energy initiative and anticipation is soaring among global solar players.
Earlier this year Saudi Arabia outlined ambitious plans to install 5.1 GW of renewable energy in the country by 2018 and up to 54 GW by 2032, with more than $100 billion slated for 41 GW of solar power.
An integral part of Saudi Arabias solar plans, detailed in the white paper published in February by K.A.CARE, the country's nuclear and renewable energy body, is to establish a solar technology hub in the country and insure local companies play a major role in the countrys burgeoning solar industry.
Through its three divisions, Jeddah-based Desert Technologies manufactures solar panels, operates as an engineering, procurement and construction (EPC) contractor and structures and finances energy generation projects. It specializes in photovoltaic, wind, waste-to-energy, geothermal and hybrid technologies.
pv magazine spoke to Nabih Cherradi, Desert Technologies' chief technology officer, about the Kingdom's ambitious plans and opportunities for local and international companies.
What prospects do you see for Desert Technologies in view of the increasing emphasis on solar energy in Saudi Arabia?
Solar energy isn't just a good idea for Saudi Arabia, it's essential. Given the opportunity cost Saudi Arabia suffers when burning its own oil for electricity generation combined with growing electricity demand, the Kingdom must reduce its reliance on domestic crude. But when we talk about reducing the Kingdom's reliance on oil, it also means diversifying the economy and developing a self-sufficient industrials sector. Value chain localization is one of the key objectives of the governments procurement plan, with the aim of building a sustainable and globally competitive domestic renewable industry.
At Desert Technologies, we've embraced this challenge and have established manufacturing facilities in the Kingdom. Were committed to Saudization, training and employing Saudi citizens, permanently importing technology and knowhow into the country and helping to develop a business sector that the Kingdom can be proud of. Weve had an overwhelmingly positive response so far, and are adding production capacity just to meet the projected demand. While solar PV remains our core focus, were also exploring opportunities in other technologies too.
We took a leap of faith, and are now set to benefit from a significant first mover advantage as the first tenders approach.
One of Desert Technologies' divisions focuses on hybrid solutions — is this something that could prove especially useful in Saudi Arabia?
Our EPC division, DT Services, is looking at several hybrid solutions to meet the demands of the Saudi Arabian market. Initially we're looking at hybrid diesel PV options, which will be particularly suitable for isolated or off-grid locations. Diesel generators are currently being used at a lot of isolated locations, but they struggle to function during the hottest times of the day and frequently break down. Transporting the diesel is also expensive and unreliable. By integrating them with a PV system weve found we reduce breakdowns (since they avoid the hottest times of day) and save money on fuel and maintenance.
In addition to Maccaferri Group, who are some of the other international partners that Desert Technologies works with?
Our partnership is with SECI Energia, the group sub-holding of the Maccaferri Group dedicated to energy, which is composed of several companies. For photovoltaic and hybrid solutions with PV we are working with Enerray, a highly experienced EPC and O&M firm with 180 MW of installed capacity. However, our collaboration extends to several other companies within the Maccaferri Group, where we're testing the Saudi Arabian and, more broadly, the MENA market as a whole. With Exergy we're looking at heat recovery solutions for gas flaring, cement factories and even recovering some of the waste heat from diesel generators within our hybrid projects in Saudi Arabia. Wind power is also a potential target market in the kingdom. Together with SEBIgas, the biogas company, we're approaching the Egyptian market and targeting the significant agricultural sector there. As you probably know, Egypt is facing its own energy challenges. SECI Energia also has experience with combined cycle natural gas plants which are of interest in both Saudi Arabia and Egypt.
Is Desert Technologies interested in working with international partners on projects in Saudi Arabia?
Absolutely. Our development division will be participating in the upcoming tenders and while were planning on raising the equity with Saudi partners, we'd certainly be happy to talk to international partners interested in investing in generation projects. We already have a technology partner for the EPC business, but we'd certainly be interested to talk a potential manufacturing partner who shares our commitment to expansion and localization. All our partners have invested significantly into the company, so our standards are pretty high.
What changes, if any, would you like to see K.A.CARE make to its plans?
K.A.CARE seems to be approaching this very intelligently. In February they issued a draft white paper with a request for feedback and comments from interested parties. Like many companies we responded, and the submissions are currently being reviewed. K.A.CARE also organized a conference on value chain localization in Riyadh in April, at which our CEO presented Desert Technologies as a case study. So K.A.CARE is clearly listening and engaging the market, and I'm positive that when the final format for the tenders is issued it will reflect both their commitment to effective solutions and to building a local industry. K.A.CARE is already focused on local content, which is ultimately the key priority for us.
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