SoftBank and the Kingdom of Saudi Arabia are planning on cashing in on the sunshine in the Middle East by building a solar project that would cost $200 billion in the oil-rich nation.
Saudi Crown Prince Mohammed bin Salman and the tech company’s CEO Masayoshi Son announced their plans Tuesday while both were in New York. Son called the solar project the world’s biggest.
The project will be bankrolled in part by the huge SoftBank Vision Fund of $93 billion, of which the largest backer is Saudi Arabia.
To start $5 billion will be used as the initial investment, of which the Japan-based SoftBank fund will give $1 billion. The remainder will come from loans to be paid off via revenue that is generated through selling electricity that the huge solar project produces, said Son.
The project is so enormous that it could take over a full decade to complete. The current target for its completion is 2030. The massive scale of this project will create complete industries in Saudi Arabia for the manufacturing as well as installation of solar equipment.
Included in that would be training facilities, and a complete research and development center in order that new technology can continue to evolve.
The solar project is expected to generate at capacity 200 gigawatts of energy, which is far more than any solar project in existence produces. It would provide sufficient energy to power simultaneously an estimated 20 billion LED bulbs.
The plans are not yet completed though. Bin Salman and Son signed the project’s memorandum of understanding Tuesday but not any binding formal agreement.
Saudi’s government has been attempting to wean the kingdom off its oil addiction and diversify its economy into different areas. Those efforts included investments of high-profile in technology including plans for a new city of $500 billion.
In 2017, Saudi Arabia made a pledge of $45 billion for investing in tech companies across the globe, and is also attempting to create a home-based thriving startup scene.
The solar project would involve solar parks being constructed across the kingdom along with massive batteries to store energy that the panels generate.
Son estimated the project would create over 100,000 new jobs and would save Saudi Arabia over $40 billion in costs to generate power. He predicted that the project would add as much as $12 billion to the gross national product of Saudi Arabia.