Saudi Arabia has potential to be hub for green finance: KPMG

Michael Hayes, global head of renewables, KPMG International.

Saudi Arabia can become the center for green finance for emerging markets, which will bring huge economic and commercial benefits to the economy in line with Vision 2030, according to Michael Hayes, global head of renewables, KPMG International.
“The amount of capital required to support the energy transition is vast and it is for this reason that a whole new sector called green finance has emerged in recent years delivering new products such as green bonds and green insurance. Much of the expenditure in renewables over the next 20 years will be in emerging markets and so Saudi Arabia should concentrate on creating a center for green finance for emerging markets,” he said.
The Saudi government intends to attract between $30 billion and $50 billion in new investments into renewables by 2030, as it plans to tender around 9.5GW of solar and wind capacities by 2023. Furthermore, the International Renewable Energy Agency (IRENA) predicts that nearly $148 billion will be required each year until 2050 to meet the goals of the Paris Agreement and limit global temperature increases to 1.5 C above pre-industrial levels.
Given these investment projections, Hayes believes it is an absolute necessity for GCC governments to invest in renewables, which is one of the key goals of governmental visions across the GCC. 
“Climate change is now recognized as the most significant risk on the planet and is likely to dominate the political and economic landscape for many years to come. While there are many different ways to help in the fight against climate change, transitioning from conventional power usage to renewable power is still one of the best and most effective solutions available,” Hayes said.
The Middle Eastern countries are well aware of their strong dependence on fossil fuels to drive economic growth. Therefore, in an era when the long-term viability of fossil fuels is under question, it is critical that these economies diversify as soon as possible. 
“Renewable generation represents an ideal way to do this and over time, I expect to see Saudi Arabia and other GCC countries take a leading role in the growth of renewable energy across the region and even into Sub-Sahara Africa,” he said.