The Public Investment Fund of Saudi Arabia (PIF) today announced the signing of a non-binding Memorandum of Understanding (MoU) with Softbank Vision Fund LP (SBVF) to create the New Solar Energy Plan 2030, the world’s largest project of its type, following the launch of the concept in October 2017. PIF and SBVF intend to complete due diligence by the end of May 2018.
The Kingdom has committed to localizing a significant portion of the renewable energy value chain in the Saudi economy, including research and development and manufacturing.
The key components of the New Solar Energy Plan will be the establishment of an electricity generation company in Saudi Arabia. Specifically, under the terms of the agreement, the PIF and SBVF will seek to commission by 2019 the Kingdom’s first two solar generation projects with 3GW and 4.2GW of solar capacity respectively. By 2030, the plan commits the parties to manufacture and develop solar panels in Saudi Arabia for solar power generation, between 150 GW and 200 GW.
Furthermore, the MOU commits the parties to explore the manufacture and development of energy storage systems, establish joint ventures for research and development and produce solar panels with a capacity of 200 GW in Saudi Arabia with the ultimate aim of negotiating the rights within the Kingdom to export power and solar panels overseas. Moreover, PIF and the SoftBank Vision Fund will identify opportunities to establish solar and battery manufacturing ecosystems in the Kingdom, helping to support sector diversification and high-tech job creation. Also, this MoU and the subproject coming out of it will enable the exportation of more oil, to meet the increase in global oil demand as some parts of the world experience oil production depletion, supporting the kingdom’s leading role in providing the world market with oil. Importantly, these projects will help create up to 100,000 direct and indirect jobs in the Kingdom. Additionally, it will increase the GDP by 12 billion dollars and save up to 40 billion dollars annually.