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An executive from state oil company Saudi Aramco has said that renewable sources could account for up to 10 per cent of Saudi Arabia's power output by 2020 with prices coming down and a regulatory framework in place.
"The proposed target is between seven to 10 per cent of peak electricity generated by renewables by 2020, most likely solar...that represents roughly five gigawatts by 2020,” Ahmad al-Khowaiter, director of new business evaluation department at Aramco, was quoted as saying by Reuters. “Can we achieve that target? It's feasible."
The Gulf Arab state has said it was investing US$80 billion to boost power generating capacity to 60,000 MW by 2020. Installed capacity in the kingdom had reached 46,000 megawatts (MW) by March, an official said recently. It was around 43,000 MW in 2009, with peak demand at around 40,000 MW. The kingdom is looking to start exporting power from solar energy by 2020.
"It (solar energy) is expensive at this point, but as we see prices are coming down we know we have a very strong probability of having both the potential and the price correct by 2020-2030 ... It is a very strategic move into solar," Khowaiter said. "We believe large scale power generation from solar can be achieved near the end of this decade, near 2020. Beyond 2020, the economics will be clearly in the favour of deployment of solar power.”
Saudi Arabia, which faces a rapid increase in power demand, hopes to approve a regulatory framework for investment in renewable energy in 2011 to set out the conditions of government funding and incentives for the sector, Khowaiter said. "We now have the target to learn to start building capacity, building the ability so we'll be able to deploy large scale and save fuel in the future and have an environmental impact, To achieve 5 gigawatts if the regulatory framework is in place it's very achievable.”
Aramco has held discussions with Abu Dhabi's Masdar City for future collaboration, Khowaiter added. In 2007, Masdar unveiled ambitious plans to invest US$15 billion in renewable energy projects such as the world's flagship carbon-free city in Abu Dhabi.