Saudi Arabia is well placed to play a key role in developing sustainable energy technologies which it has been exploring through scientific research, Maria Van der Hoeven, Executive Director of the International Energy Agency (IEA), told Oxford Business Group publishing, research and consultancy firm.

"Saudi Arabia holds a natural advantage in solar power, and experience elsewhere in the region suggests that the Kingdom could benefit from both photovoltaic systems and from developing larger concentrated solar power projects," she said. "The IEA is pleased with the collaboration we enjoy with Saudi Arabia, and impressed by the nation’s dynamic plans for energy developments."

Saudi Arabia is seeking investors to back its $ 109 billion plan to create a solar sector capable of providing 30 percent of its electricity by 2032.

According to Maher Al-Odan, a consultant at the King Abdullah City for Atomic and Renewable Energy (Ka-care), the plan involves developing 41,000 megawatts of solar power within two decades. 25,000 MW will be from solar thermal plants, using huge heliostatic mirrors to reflect the sun’s rays onto a central tower that heats a fluid to drives a turbine; and 16,000 MW will be in the form of photovoltaic panels.

Al-Odan said "we are not only looking for building solar plants. We want to run a sustainable solar energy sector that will become a driver for the domestic energy for years to come." Khalid Al-Suliman, vice president of Ka-care, said that an extra 21,000 megawatts of power will be added in the form of nuclear, wind, and geothermal.

SolarReserve LLC, a US maker of technology that uses sunlight for power, plans multiple bids for Saudi Arabia’s first renewable-energy tender as the country plans to generate a third of its electricity from solar by 2032.

SolarReserve has formed a joint venture in Saudi Arabia and is working on preliminary proposals for the tender, Chief Executive Officer Kevin Smith said. Its technology uses thousands of mirrors to concentrate sunlight onto a central point to generate heat, which is then used to produce power. The energy can be stored in molten salt until electricity is needed. "We have put together proposals and project structures for the government and we expect to participate actively in the tenders," Smith said. "We will submit between one and three bids in different project structures and in different parts of the country."

Saudi Arabia plans to start its first tender targeting 2,000 megawatts of solar energy in early 2013. It plans a second tender in 2014 aiming for 2,500 megawatts.

The country in May said it’s looking for investors to build a $ 109 billion solar industry by 2032. Companies including Canadian Solar Inc., and Centrotherm Photovoltaics AG have also expressed an interest in the region.

The size of the projects the technology maker would enter depends on the structure of the tender, Smith said. "There has been talk of a multi-thousand megawatt tender and we potentially would look at larger projects in the 250-megawatt to 500- megawatt size range," he said.

The economics in Saudi Arabia are "pretty straightforward," said Smith, as solar thermal power is more cost-effective than burning oil, assuming the alternate price the country can make for oil is $ 100 a barrel.

The full-length commentary by Van der Hoeven will appear in "The Report: Saudi Arabia 2013", OBG’s forthcoming guide on the country’s economic activity and investment opportunities.

She further said Saudi Arabia’s commitment to meeting rising demand for oil and gas from the global markets will be a key driver in efforts to revive global economic growth.

She said Aramco’s capacity to provide 2.5 million barrels per day (bpd) more than current production levels took on added importance in the current economic climate.

"Saudi Arabia has long been a lynchpin of global oil and gas production," she said. "The Kingdom has proven a reliable partner and supplier. I am particularly glad to have such reassurances now."

Van der Hoeven highlighted the investment Saudi Arabia was channeling into key developments which she said would prove instrumental in helping the Kingdom maintain production. "A large new offshore oilfield, Manifa, is due to come on-stream in early 2013," she said. "In addition, the Kingdom’s first large offshore gas field, Karan, is coming on-stream around late 2012."

With concern mounting that Saudi Arabia’s strong growth could lead to the Kingdom consuming much of its own oil output by the middle of the next decade, Van der Hoeven was keen to map out the country’s exploration efforts. "Saudi Arabia is certainly not standing still," she said. "It has successfully explored for extra gas in the southeast and is exploring in the north-west of the Kingdom and offshore in the Red Sea."