The world’s biggest oil company, Saudi Aramco, has partnered with US energy firm General Electric (GE) to develop the first wind turbine of its kind in Saudi Arabia. The new turbine, supplied by GE, will provide power to Saudi Aramco’s bulk plant in Turaif. Its creation signals an important step forward for renewable energy production in the oil-dependent kingdom.
The unique turbine technology will be able to convert the wind’s kinetic energy into 2.75MW of power at its peak, which Saudi Aramco has said is enough to power around 250 Saudi households.
The impressive structure will have a diameter that is 50 percent wider than the 120 metre-wingspan of an Airbus 380, and could reduce the burning of diesel for power generation by 18,600 barrels of oil per year.
The unique turbine technology will be able to convert the wind’s kinetic energy into 2.75MW of power at its peak
Saudi Arabia is the world’s largest exporter of oil and currently produces only one percent of its energy through renewables. This new turbine is therefore an important manifestation of the kingdom’s growing commitment to renewable energy production, yet it is also part reaction to dropping oil prices in the Gulf.
Falling oil prices has put mounting pressure on the kingdom, pushing it to consider diversification measures in order to reduce the country’s reliance on oil exports. Riyadh cut the pay of government workers for the first time last month, while falling revenues also led Saudi Arabia to support OPEC’s first production cap in eight years.
In April, Deputy Crown Prince Mohammed bin Salman announced the kingdom’s new energy restructuring plans, including setting a 9.5GW renewable energy production target for 2023 as part of the government’s Vision 2030 initiative. The steep increase in electricity tariffs at the beginning of 2016 put the country in the right direction with regards to this programme, while the construction of the new turbine in Turaif is tangible proof of the kingdom’s progress towards freedom from oil dependency.
Also in 2016, Aramco made a $2trn IPO announcement. As the world’s largest oil company, the mammoth stock market listing will help to dramatically reduce the kingdom’s oil-generated government revenues and move the country towards profitable renewable energy production.
Mohammad bin Salman bin Abdulaziz Al-Saud, Chairman of the Council of Economic and Development Affairs in Saudi Arabia, said in his Vision 2030 statement: “We are determined to reinforce and diversify the capabilities of our economy, turning our key strengths into enabling tools for a fully diversified future. As such, we will transform Aramco from an oil producing company into a global industrial conglomerate.”
CNN has estimated the float would result in Aramco being four times the size of Apple, and over five times the size of ExxonMobil.
Aramco’s motto is “where energy is opportunity”. In an energy market of drastically changing commodities, Aramco, to its credit, appears to have fully embraced this forward-looking mentality. With such mammoth projections of market dominance after a decade of delays on renewable energy project deadlines, its trillion-dollar valuation, coupled with a strong commitment to renewable energy production, signposts continued success for both Saudi Arabia and sustainable energy solutions across the globe.