Saudi Arabia has unveiled an initiative which includes incentives for renewable energy projects as part of a strategy to slash reliance on crude oil in power generation. 

Announcing the initiative on Thursday, the Industry and Mineral Resources Ministry said it would provide tax exemptions and other facilities to companies involved in the production of electricity and renewable energy. 

“This initiative is intended to enable those companies to benefit from the numerous incentives and facilities offered to industrial establishments in the Kingdom, mainly tax exemptions for power and renewable energy projects,” the Ministry said in a statement carried by the official Saudi press agency. 

The statement said the initiative is also designed to ‘bolster the capabilities’ of those companies to increase power production and to support the Kingdom’s plans to become a regional electricity export hub within its Vision 2030. 

The statement did not provide details of the incentives but said they could contribute to a steady rise in renewable energy projects and support Vision 2030 targets to expand renewable sources and natural gas to 50 percent of the country’s energy mix by 2030. 

In previous press comments, Saudi Oil Minister Prince Abdul Aziz bin Salman achieving that target would allow the Kingdom to save nearly one million equivalent bpd, adding that this would contribute to increasing crude exports. 

(Writing by Nadim Kawach; Editing by Anoop Menon)

(anoop.menon@lseg.com)