Electricity generation analyses in an oil-exporting country: Transition to non-fossil fuel based power units in Saudi Arabia

In Saudi Arabia, fossil-fuel is the main source of power generation. Due to the huge economic and demographic growth, the electricity consumption in Saudi Arabia has increased and should continue to increase at a very fast rate. At the moment, more than half a million barrels of oil per day is used directly for power generation. Herein, we assess the power generation situation of the country and its future conditions through a modelling approach. For this purpose, we present the current situation by detailing the existing generation mix of electricity. Then we develop an optimization model of the power sector which aims to define the best production and investment pattern to reach the expected demand. Subsequently, we will carry out a sensitivity analysis so as to evaluate the robustness of the model's by taking into account the integration variability of the other alternative (non-fossil fuel based) resources. The results point out that the choices of investment in the power sector strongly affect the potential oil's exports of Saudi Arabia. For instance, by decarbonizing half of its generation mix, Saudi Arabia can release around 0.5 Mb/d barrels of oil equivalent per day from 2020. Moreover, total power generation cost reduction can reach up to around 28% per year from 2030 if Saudi Arabia manages to attain the most optimal generation mix structure introduced in the model (50% of power from renewables and nuclear power plants and 50% from the fossil power plants).

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