SoftBank, Saudi Arabia to build $200-bn solar project

Masayoshi Son chairman and chief executiveof Soft Bank Group shakes hands with Crown Prince Mohammed bin Salman in New York after signing an agreement for the huge solar project. Jeenah Moon  Bloomberg

Saudi Arabia and Japanese telecom giant-turned-tech investor SoftBank Group Corp. have expanded their partnership to create a massive solar power generation project. If built, the development would nearly triple Saudi Arabia's electricity generation capacity, which stood at 77 gigawatts in 2016, according to BNEF data.

The deal was signed in presence of Saudi Crown Prince Mohammed bin Salman who is on a U.S. visit.

Bloomberg reports that SoftBank CEO Masayoshi Son and Saudi Crown Prince Mohammed Bin Salman signed a memorandum of understanding yesterday to build the huge new solar plant.

The solar power project is expected to have the capacity to produce up to 200 gigawatts (GW) by 2030.

"You have never seen something of this scale", he is reported as saying. The project will be part of the SoftBank Vision Fund, which was set up in 2016, and has invested in many projects in the US, India and Europe. According to the Solar Energy Industries Association kept large-scale projects' list, there are roughly 70 gigawatts of solar capacity in under development or construction in the United States which will start generating electricity in 2019. There are now only a few small solar power projects in the country.

Mr Son said he envisions the project, which runs the gamut from power generation to panel and equipment manufacturing, will create as many as 100,000 jobs and shave US$40 billion off power costs. That's a boost for Prince Mohammed, who's been at the forefront of the Vision 2030 campaign to diversify the kingdom's economy away from oil by that year.

Earlier on Tuesday, the Saudi-U.S. CEO Forum gathered American and Saudi business leaders in NY, where the kingdom announced about three dozen memorandums of understanding with U.S. firms, which are often the first step in establishing business ventures.

It will cost $5 billion with $4 billion coming from financing and $1 billion from Softbank's Vision Fund.