On March 28, 2018, Sun Yat-sen, CEO of Japan Softbank Group, and Mohammed Ben Salleman, Crown Prince of Saudi Arabia announced cooperation in New York to establish the world’s largest solar power project in Saudi Arabia. The project complements Saudi Arabia’s Vision 2030 (Vision 2030) and aims to free Saudi Arabia of its oil dependence.
Although the two sides have only signed a Memorandum of Understanding (MOU), project-related due diligence is expected to be completed by the end of May. Follow-up action is not yet known, but the ambitions of Softbank and Saudi Arabia behind this move should not be underestimated.
"The biggest in the world"
The most compelling aspect of this news is the large scale of its projects.
First, the cost is high. The solar power project is expected to require 200 billion U.S. dollars by 2030, and it will spend 5 billion U.S. dollars to build two solar power plants. The SoftBank Vision Fund, which is jointly invested by the two companies, will contribute 1 billion and the rest will come from Project fundraising.
Second, the amount of electricity generated is amazing. The partners announced that the solar energy project will generate 7.2 GW of electricity by 2019, and by the end of 2030, the power generation will reach 200 GW, which is equivalent to four times the current total of solar power generation in the United States. half.
Third, huge profits. According to Saudi Arabia’s estimates, these projects will directly or indirectly create 100,000 jobs in Saudi Arabia. When solar energy gradually replaces part of the oil and gas to generate electricity, it will not only be able to spend US$40 billion on the expenses of Saudi Arabia each year, but also make GDP grows by 12 billion U.S. dollars.
It can be said that Saudi Arabia’s future ambitions will at least turn its oil dividend into a global influence. It will not only be a regional power but will also focus on the global field. To achieve this goal, it is precisely necessary for Saudi Arabia to get rid of domestic over-reliance on oil as the premise, to adjust its domestic economic structure, and to develop new energy based on.