Public Investment Fund (PIF) has signed three new agreements to localize in Saudi Arabia the manufacturing and assembly of equipment and components needed for solar and wind power.
These agreements have been entered into by the Renewable Energy Localization Company (RELC), afully owned PIF company. They are in line with the Saudi Ministry of Energy’s drive to localize the production of renewable energy components.
The three joint ventures (JVs) represent the latest in a series of investments by PIF in the utilities and renewables sector to support Saudi Arabia’s energy needs and consolidate its position in the field of clean power.
RELC focuses on creating partnerships between leading global manufacturers and the Saudi private sector to meet growing local and export demand for renewable energy, and secure and strengthen local supply chains. It works toward achieving the most appropriate mix for electricity production and replacing liquid fuels currently used in electricity and other sectors in Saudi Arabia, in line with Saudi efforts toward achieving Vision 2030 targets.
Image Credits: PIF | Cropped by GBN
The first agreement involves a JV with the wind power technology company Envision Energy and the Saudi firm Vision Industries. It will involvethe manufacture and assembly of wind turbine components including blades with an estimated annual generation capacity of 4 gigawatts (GW). Under this agreement, RELC will hold 40 percent of the JV, with Envision holding 50 percent and Vision Industries holding 10 percent.
Image Credits: PIF | Cropped by GBN
The second JV features the manufacturer Jinko Solar, which supplies photovoltaic energy technologies, and Vision Industries. This JV entails localizing the manufacture of photovoltaic cells and modules for high-efficiency solar generation. Under the agreement, which envisages annual production of 10 gigawatts (GW) generation capacity, RELC will hold 40 percent of the JV, with Jinko Solar holding 40 percent and Vision Industries holding 20 percent.
Image Courtesy: PIF | Cropped by GBN
The third JV is with LUMETECH S.A., a subsidiary of TCL Zhonghuan Renewable Energy, along with Vision Industries. This deal will localize the production of solar photovoltaic ingots and wafers with annual production sufficient to generate 20 GW of power. Under this agreement, RELC will hold 40 percent of the JV, with LUMETECH holding 40 percent and Vision Industries having 20 percent.
Yazeed Al-Humied Deputy Governor & Head of MENA Investments PIF
“The new agreements are part of PIF’s efforts to localize advanced technologies in the renewable sector in Saudi Arabia and meet commitments to increase the share of local content, as well as contribute to localizing the production of 75 percent of the components in Saudi Arabia’s renewable projects by 2030 in line with the Ministry of Energy’s National Renewable Energy Program. These projects will also enable Saudi Arabia to become a global hub for the export of renewable technologies. PIF aims to achieve these targets through its projects and portfolio companies, including RELC, which support PIF’s progress in renewable energy and investment, and enhance partnership with the private sector.”
These agreements will enable the localization of advanced power generation and manufacturing technologies for renewable energy production in Saudi Arabia as well as maximize local content, to help meet growing domestic, regional and international demand. The agreements will enhance the ability of local manufacturing to benefit from the global energy transition and will support PIF’s efforts to consolidate Saudi Arabia’s position as a global center for exporting products and services for the renewables sector.
The involvement of Vision Industries, a leading investor and developer of clean energy industrial projects and local supply chains, alongside these three Chinese companies reflects PIF’s continuous efforts to attract international investors while further enabling the Saudi private sector.
Overall, PIF, through Acwa Power and Badeel, is currently developing a total of eight renewable energy projects with a total capacity of 13.6 GW, involving over $9 billion of investment from PIF and its partners. These joint projects: Sudair, Shuaibah 2, Ar Rass 2, Al Kahfah, Saad 2, Haden, Muwayh, Al Khushaybi, are intended to enable and support the local private sector through significant local content requirements and procurement of equipment, supplies and services through local supply chains.
Utilities and renewables together make up one of PIF’s key strategic sectors. The development of Saudi Arabia’s renewable energy sector is also a core objective of Vision 2030, Saudi Arabia’s blueprint for a modern and diversified economy.
