The groundbreaking solar project helping to power a brighter tomorrow

Global Insights
02 July 2023 Sakaka, Saudi Arabia
  • ACWA Power, in which PIF holds a stake, is advancing the energy transition through advances in solar tech 
  • Clean energy contributes to Saudi Arabia’s target to reach net zero by 2060 
  • PIF is committed to developing 70 percent of the country’s renewable energy by end of decade
The world is facing the challenge of a fast transition from fossil fuels to reliable, affordable and clean energy alternatives. Saudi Arabia’s Public Investment Fund (PIF) is financing a large-scale solar project run by ACWA Power, which is helping to kickstart the country’s aim to become a global energy transition leader.
The latest IPCC report highlights the significant changes we must all make if we are to limit the rise in global temperatures to just 1.5 degrees. Organizations and institutions are therefore turning focus towards reducing carbon emissions, working towards the scenario that would do the least damage to the planet.
One such organization is PIF. As Saudi Arabia’s Public Investment Fund, it is investing $10bn in green projects by 2026, as part of a larger investment portfolio that includes a diverse range of investments across sectors, including oil and gas.
The Energy Transition
The global energy and power sectors are going through fundamental shifts, and must adapt accordingly, looking for opportunities presented by the transition. Energy providers are examining ways to transform their practices.
Saudi Arabia has set itself the challenge of reaching net zero emissions domestically by 2060. This is a new frontier for the Kingdom. It’s the world’s largest producer and exporter of oil and the tenth largest emitter of carbon dioxide. This commitment from Saudi Arabia, which has one quarter of the world’s known oil reserves, highlights a new age of investment into renewable energy and promotes the energy transition.
Enter Sakaka
One such investment is the Sakaka Solar project in Saudi Arabia’s Al-Jouf province. It’s a pilot project for bigger and better things to come, run by ACWA Saudi Arabia, headquartered in Riyadh. With a portfolio of 15.7 GW of renewable energy, ACWA Power has a strong track record in exploring innovative engineering solutions to drive up performance and drive down cost.
To mitigate the challenges posed by climate change, the IEA “Net Zero by 2050” report states that meeting the world’s global energy target will require the installation of the equivalent of two large solar power stations each day.
With its 300 MW installed capacity, the Sakaka site generates 900 GWh per year, which would otherwise have produced at least 600,000 tons of CO2. Sakaka is the first utility-scale solar energy project under the National Renewable Energy Program in Saudi Arabia, and ACWA’s Chief Technology Officer, Bart Boesmans believes it could be a blueprint for the future.
“Essentially, the energy transition is not possible without massive use of renewables,” he says. “And in order to optimize the production of solar energy, you need to be in a place with lots of sunshine, and lots of available land. Saudi Arabia has both. The country also has the right financing conditions and a stable economy. We are now achieving photovoltaic projects at a cost we didn’t even dare dream of 10, 15 years ago.”
The change has been fueled mostly by technology innovations. “Think of it like the smartphone,” explains Boesmans. “As more people got smartphones, that technology became cheaper and cheaper, and the parts became more affordable. It’s the same with renewables – in fact, using renewables actually reduces the cost of electricity overall. It’s easy to think solar is simple tech, but as the industry grows, the cheaper everything gets and there’s more performance for the same price. There’s lots of progress in the solar cell’s microtechnology, year after year, and this continues.”
Investing in Innovation
ACWA Power say they’re always looking to explore new ways to improve efficiency. They are continuously testing the next generation of photovoltaic technologies, looking to increase the output and efficiency of each panel by converting more of the light into electricity. They have introduced new technologies such as passively cooled string inverters and bifacial panels which produce electricity even from the light reflected on the back of the panels.
Now, they are focusing on improving robotics for cleaning panels and using machine learning to maximize the output of each solar plant. As Saudi Arabia is mostly desert, keeping the solar panels clean of sand and dust is important so that they operate at maximum efficiency. Using machine learning and predictive analytics, ACWA have developed an automated system for knowing when to clean the panels.
Saudi Arabia receives 12 hours of sun daily, has large areas of available land, and boasts a “well-developed grid infrastructure,” says Mohammed AlBalaihed, head of energy and utilities in PIF’s MENA Investments division. “This means that Saudi Arabia can produce good value renewable energy. It illustrates why the country’s vast energy potential is about so much more than oil.”
A Brighter Future?
ACWA’s ambition, with Sakaka and solar in general, is to realize Saudi Arabia’s goal to ensure that 50 percent of all power is generated from renewables by 2030. “Solar offers almost limitless potential,” Boesmans says. “This is an important part of PIF’s strategy to build capacity in renewable energy, and its commitment to develop 70 percent of Saudi Arabia’s renewables by the end of the decade,” explains AlBalaihed.
Another planned use for solar power in Saudi Arabia is green hydrogen. The commonly used “colors” of this invisible gas refer to the means of production, and unlike grey or blue, green hydrogen production is classified as carbon-free, as it’s made by using electricity from renewable sources to split water molecules into hydrogen and oxygen.
ACWA Power sees enormous potential in green hydrogen, despite the technical challenges of transportation and storage. Thanks to natural advantages of abundant land, good solar and wind potential, and coastal proximity for desalination to provide the water for splitting into hydrogen, Saudi Arabia offers the geographical ingredients required to scale green hydrogen production. Add in the structural importance of affordable financing, infrastructure and engineering expertise and it means that though it may currently be more expensive than other means of production, the green hydrogen opportunity in Saudi Arabia is huge.
ACWA Power, together with Air Products and NEOM, have created the NEOM Green Hydrogen Company, who are planning to build the world’s biggest green hydrogen plant. “The world is already using 80 million tons of hydrogen in refineries and other uses. Saudi Arabia is well situated to produce green hydrogen cheaply and can export it to countries with less ability to produce it. This is where the project in NEOM comes in,” explains Boesmans.
“In this project, green hydrogen is converted to ammonia to ship it efficiently to international markets, where the ammonia is converted back to hydrogen. This way, renewables not only contribute to reaching the zero emission targets by 2060 in Saudi Arabia itself, but also make Saudi Arabia an enabler for the energy transition in other countries which have less potential for renewables.”
It’s clear that there is strong potential for renewables in Saudi Arabia. There’s wind, sun, and vast amounts of land, perfect for piloting and scaling up new technologies. That’s why PIF, one of the largest sovereign wealth funds in the world, is investing in sustainability initiatives. It understands the vital need for change.