Officials from Saudi Arabia’s Public Investment Fund (PIF) and Japan’s SoftBank Group have met for preliminary talks on the funding possibilities for the recently announced solar power project in the Kingdom.
Both parties have been meeting over the past few weeks along with key international banks to determine the best financing strategy that suits a project of this magnitude.
In March, Softbank and PIF signed a deal to create the New Solar Energy Plan 2030, the world’s largest solar project of its type.
Despite pessimism from a section of industry experts who see it as overly ambitious, Saudi Arabia is determined to push forward with the 200GW solar project, expected to cost $200bn.
The Kingdom has embarked on a huge push to transform its economy and reduce its dependence on oil.
Being one of the world’s biggest oil exporters, Saudi Arabia’s rulers view solar power as a way to cut the amount of crude it uses to generate power at home and raise its overseas shipments.
At the time of the announcement in March, SoftBank Chief Executive Masayoshi Son said the project was expected to have the capacity to produce up to 200 gigawatts (GW) by 2030, adding to around 400 GW of globally installed solar power capacity.
The initial phase of the project, for 7.2 GW of solar capacity, will cost five billion dollars, with one billion dollars coming from SoftBank’s Vision Fund and the rest from project financing, Son said.