The New Saudi Energy Formula

Efficient Consumption in an Oil-Rich Country

Saudi Aramco engineers and journalists look at the Hawiyah Natural Gas Liquids Recovery Plant in Hawiyah, in the Eastern Province of Saudi Arabia on June 28, 2021. (AP /Amr Nabil)
Saudi Aramco engineers and journalists look at the Hawiyah Natural Gas Liquids Recovery Plant in Hawiyah, in the Eastern Province of Saudi Arabia on June 28, 2021. (AP /Amr Nabil)

The New Saudi Energy Formula

"In the past few decades, our neighbors used to go on a two months’ vacation, leaving the home ACs on. Why? He was told that here in Jeddah, it will be hot when they come back! They could not wait for 20 or 30 minutes to have the home cool again!"  Ziad, a Saudi Engineer in his late 30's, told Majalla English when asked about wasting energy behaviors in the past decades.

"One liter of gas used to cost SR 0.45 (12 cents) in 2016. Now, drivers pay SR 2.18 (58 cents) for the same amount. People now are becoming more cost conscious about energy consumption. Wandering the streets [by car] is not the favorite hobby anymore," he added.

The gradual transformation of the Saudi energy consumption scene had started with the foundation of the Saudi Energy Efficiency Center (SEEC) in 2010. This center has played a vital role in reshaping the scene towards less waste, efficient consumption and more awareness.

Let's discover how Saudi Arabia managed to consume less energy despite the growing number of people, vehicles and factories that are adding to the energy efficiency challenge of continuously expanding cities.


SEEC focuses on four high-energy-consumption sectors in the Kingdom including:

1. Industry (Over 10,000 factories consume 48% of the initial energy consumption);

2. Residential (Around 7 million residential units consume 29% of the initial energy consumption);

3. Land Transport (Approximately 12 million vehicles account for 18% of the initial energy consumption); and,

4. Common Utilities (Electricity and Desalination Stations consume 5% of the initial energy consumption).

SEEC focuses on energy efficiency laws, recommendations, awareness campaigns and cooperation with other governmental agencies.

"Both old and new factories are required to take energy efficiency measures to get a new licence or renew the old one. Saudi Arabia's industrial sector energy consumption performance is being supervised by SEEC in cooperation with the related parties to prevent energy waste and do more with the existing energy,"  Taher Taher, a specialist in industrial sector  contracting, told Majalla.

"Have you seen SEEC's pre-summer awareness campaign? They said that 24c is the perfect temperature for ACs for higher performance and less electricity consumption. The majority of people do not know this piece of information, I believe," he added.

A field of solar panels at Saudi Arabia’s King Abdulaziz City of Sciences and Technology. (Reuters)

It is good to note that SEEC has worked closely with Saudi Standards (previously known as Saudi Standards, Metrology and Quality Organization) to issue the Fuel Economy Card, which is a sticker car agents stick on new vehicles to show fuel consumption efficiency levels on a set scale from excellent to poor. The same applies for electrical appliances. Inefficient vehicles and electrical appliances have been gradually banned from entering the local market.

"Thermal insulation for all buildings is a must. No building operation licence is given unless thermal insulation is applied. A few years back, SEEC launched an awareness campaign for lighting materials that save electricity. It starts with awareness and ends with new regulations to improve the quality of life," explained Taher.


"Success is relative and gradual progress is what Saudi aims to achieve. The new SEEC regulations have excluded all electrical appliances with high electricity consumption. The Kingdom witnessed lower gas consumption from 2018 until now. The peak was in 2017 at 208 million barrels of gas annually, compared to 175 million barrels of gas in 2021," said Eng. Taher.

"It's not SEEC alone.  It is the collective work of governmental agencies to free up more oil capacity for export and cut down waste, and, consequently keep the environment cleaner," he added.

The Saudi Electricity Company (SEC) has managed to decrease its diesel consumption to 48% in 2019. The peak of electricity consumption was reached in 2018 with a total consumption of 299 thousand megawatts in power. In 2019, the consumption has started to fall to the levels of 2014 and 2015 to be around 280 thousand megawatts.

We have to take into consideration that the government has reformed energy products prices to be SR 0.18 (4.8 cents for each kilowatt) in 2018 up from SR 0.05 (1.3 cents).

Coupled with SEEC's awareness campaigns, raising the price of electricity has made people more cost conscious and cut down on waste.


Added to the SEEC efforts is the partial reliance on clean energy. For example, the construction of Sudair’s Solar Energy Station, which was announced by the Public Investment Fund last April, will begin soon. It is going to produce 1500 megawatts of electricity which has the capacity to light up 185,000 residential units. Sudair is located in the middle of the Kingdom.

Part of the fossil oil consumption efficiency is the reliance on non-fossil oil products. Another solar station will be in Al Jouf, North of the Kingdom, and is set to produce 300 megawatts annually. This is part of the Saudi ambition to produce 9.6 gigawatts from clean resources annually by 2023.

Saudi Arabia exports 7.5 million barrels of oil daily. The local consumption is around 3 million barrels daily in winter and 3.9 million barrels daily in summer. However, the production capacity has reached around 13 million barrels. 

“The equation is clear. More output with efficient domestic consumption means better exports, less waste, and more sustainability,” concluded Taher.

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