Saudi Arabia is aiming for 40 gigawatt hours of energy savings this year.
This is according to the National Energy Services Company (National ESCO), launched by the Public Investment Fund (PIF) in October last year.
The PIF, together with National ESCO, aims to foster collaboration with foreign private equity partners, in order to achieve its economic diversity and environmental sustainability objectives.
According to PIF’s chief executive, Waled Al Ghreri, “We estimate that taking everything into consideration, the collected savings of this year will be around up to 40 GWh,”.
“We started six or seven months ago and we have 10 RFPs [request for proposals] in the pipeline… We’re putting together a set of projects that will not only attract energy efficiency companies, but also have the clients – government entities – to adopt these projects.”
Saudi Arabia is the world’s largest oil exporter and consumes three times more energy per capita than the global average.
This energy consumption, together with the recent onset of value added tax and power tariff increases, have also put pressure on both public and private sectors to begin implementing energy efficiency measures, said Mr Al Ghreri.
National Esco has been tasked with implementing energy efficiency measures at schools, mosques, and all public buildings occupying 30,000 square metres or more of floor space. 1.9 billion riyals ($507 million) has been provided to the organisation to launch and provide impetus for the projects.
“The expected returns of these projects is between 10 to 12 % and with some leverage becomes very attractive. We’ll be announcing soon in terms of size and capital for these projects,” Mr Al Ghreri said.
In order to achieve the Vision 2030 goals for economic transformation, Saudi Arabia has begun investing more resources into renewable energy and energy efficiency measures.
To support this drive, the kingdom’s Renewable Energy Project Development Office announced its intention to deploy about 9.5GW of renewable capacity by 2023, with 4GW of wind and solar project tenders being the first to be publicised.