Sources told Reuters that Saudi Arabia’s plan to issue bids for its first solar power projects, announced in 2013, has been postponed.
“It hasn’t been approved yet, we are in a waiting mode,” said a Saudi government source who declined to be identified. There are disagreements over their scale, ownership and technology.
“There is a divergence of views. Everybody agrees on the goals, but they have different ideas on how to implement them”, he added.
The body set up to manage the transformation towards new and renewable energy sources, the King Abdullah City for Atomic and Renewable Energy (K.A.Care), has made little progress due to competition with the ministries of electricity and oil.
“The key issue is K.A.Care does not belong to any particular ministry leading the initiative and does not have the balance sheet to conclude power purchase agreements directly,” said Imtiaz Mahtab, president of the Middle East Solar Industry Association.
“We need to develop a better understanding of solar power and its associated technologies, but it would be unrealistic to think that it is an alternative to large-scale power generation technologies at this time,” said Sadad al-Husseini, a former senior Aramco executive and now an energy consultant.
According to the Financial Times K.A.Care had already announced in in January that the completion of its $109bn solar project, which would create 41GW of energy capacity by 2032, would be delayed by another eight years.
Investors and developers are losing patience, consultants have warned.
“They are burning the oil because they have it,” said Holger Rubel, who leads Boston Consulting Group’s green energy and sustainability practices. “They have to find a business case for turning to solar.”