
SoftBank Group and Saudi Arabia plan to spend $200B building a solar power plant - doppp
https://techcrunch.com/2018/03/28/softbank-group-and-saudi-arabia-plan-to-spend-200-billion-building-the-worlds-biggest-solar-power-plant/
======
lewis500
I always look for the surprising angles in a development of this kind: the
knock-on effects. Given 200GW of capacity, in Saudi Arabia, on some days there
will be endless electricity.

What I'm thinking is that this will lead to innovation in industrial processes
that can productively use a lot of energy in a 4-8 hour window...something you
can turn on in a big way and then turn off. Such a process effectively
"stores" the energy in the product. The larger the electricity share of such a
process, the closer the marginal cost gets to zero during sunny times.

Most modern industrial processes aren't like that: either they're not very
power constrained (e.g., a toy factory) or they need the power to be on for a
while (e.g., a steel mill). But then again it makes sense these are the types
of processing we've perfected, since that's the kind of power we've hard so
far in large quantities (coal, nuclear).

Does anyone know of products that can be made quickly by the application of
raw energy? I don't know how desalination works, but (just as an example) if
there were such a desalination process then Saudi Arabia could desalinate
tremendous amounts of water and store it...or even export it to neighbors.

I am not so excited about the idea of a fundamentalist monarchy---one that is
helping starve the poor Yemenis---getting even more power, but I am excited
about the downstream innovations the fact of nearly-free electricity could
potentially create. If SA invents such processes, then they could be copied in
other places.

~~~
credit_guy
Aluminum smelting.

Desalination is a good idea too, but instead of selling the water they could
use it to grow forests and then sell carbon credits.

~~~
andy_ppp
Growing forests would be incredible, it’d be like rain forest eventually
right? It would be very strange to see a substantially green country in the
Middle East.

~~~
sp332
But to do that you need to increase the salinity of the nearby ocean for
years.

~~~
tdb7893
How much of the increase in salinity stays? The ocean is huge and the water
moves so I'm surprised that desalination has a large effect in that regard

~~~
TaylorAlexander
I think “the Earth is huge” is one of those things that makes intuitive sense
to us, but that fails to take in to account the scale with which we operate. A
desalination plant must put a lot of excess salt into the ocean somewhere.
Whenever you’re dumping high quantities of something into the ocean, there’s
always going to be some effect. The question is just “how significant” is the
effect. I assume the local animal population could perhaps be greatly
affected. And depending on the region there could be effects on migrating
populations as well. Everything we do has an impact.

------
ggm
I believe it won't be one organic unit of power at this scale. it will be sub-
multiples, ganged up in ways which make it both more resilient, and more
useful. It will almost certainly be distributed too, because thats how you
make a power system resilient against local constraints. So, calling a 'power
plant' instead of 'several discrete power plants' is probably headline-ese.

(the solar furnace pictures I've seen in other places tend to have more than
one unit of target, and storage, and production)

I believe over-capacity is common in these kinds of things, to ensure a lower
sub-multiple of the book power is available so this power budget could be
written to lossy storage, or be a huge oversupply to sell at profit on the
spot market with loss on transmission but have reserve powers to meet local
demands. Or for things like desalination or industries which need high energy
inputs. An Aluminium smelter in Australia is looking to use PV to drive some
of its costs down. Thats a huge 24/7 power burden, but the thermal mass in the
pot-line behind smelting can act as a power buffer, so it may be a dual use
proposal in some ways: make power which has loss risks, find uses which can
buffer them, have hysteresis, then sell what you can beyond the committed
reserves you can store.

Saudi is diversifying away from an oil economy so its possible this is a sign
of that, seeking cost and revenue outcomes which decouple the state budget and
revenue streams from oil price shocks.

~~~
adventured
> Saudi is diversifying away from an oil economy so its possible this is a
> sign of that, seeking cost and revenue outcomes which decouple the state
> budget and revenue streams from oil price shocks.

They ultimately have no choice but to get very aggressive, very soon, if they
want their nation to survive.

Their population has doubled since 1990 and tripled since 1982. They're adding
about 800k-900k new people per year, which is a lot on their base (about
double the rate of Australia, which is growing solidly from high immigration).

It's going to be essentially impossible to maintain their standard of living -
which is comparable to the Czech Republic, upper mid tier - if they don't come
up with a replacement for domestic oil consumption. Long before oil starts to
decline globally, the Saudis will be destroying themselves economically
through domestic population demands on their energy exports (that has already
become a problem, not yet critical though).

This and nuclear tech, are the two ideal ways for them to ensure a maximum
amount of oil is available for export in the coming decades.

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mjrpes
To put 200 gigawatts into perspective, the largest US nuclear power plant
generates 4 gigawatts. The US total generating capacity in the summer is 1000
gigawatts.

~~~
rgbrenner
You cant compare nameplate capacity to actual energy production. You have to
adjust the nameplate capacity by the capacity factor first.

It's almost certainly PV.. because the price -- $200B for 200GW -- matches
perfectly the current price of a new utility scale PV plant ($1/Watt). Those
plants have a capacity factor of 10-30%. It'll probably be close to the 30%.
So that would reduce the 200GW to 60GW.

~~~
nigelcleland
Not quite, the instantaneous energy output from the system will be at 200GW
when the sunshine is at a maximum. The average output of the system would be
60GW (at a 30% capacity factor). In terms of total energy this would equate to
around 525TWh worth (60 * 8760 / 1000). Or, 525,000,000 MWh.

That is, for every $1/MWh that the solar station gets paid for it's output it
will receive half a billion dollars a year.

Now, a station of this size would massively depress power prices throughout
the region unless there was some form of large scale storage unit which could
soak it up.

Probably more impactful is the Saudis are currently using oil for their power
stations which is heavily subsidized.

~~~
electricityUser
If you get 2000 kWh/yr per kWp from PV there and have an installation of 200
GWp you'll end up with 400 TWh per year. If we assume a 25 year lifetime for
this installation that's 9600 TWh. At cost of 200 billion dollars, wouldn't a
MWh from this system cost close to $21 instead of $1?

Or - taking your numbers - the installation would have to last 400 years
without operational costs considered. Isn't that a loss for whoever invests in
something like this?

~~~
Reason077
$21/MWh is very cheap energy. Far cheaper than any modern nuclear plant, and
significantly cheaper than most fossil-fuelled energy even before you account
for carbon/pollution externalities.

~~~
onetimemanytime
is that 2.1 cents a kwh? Dirt cheap.

I've read that solar panels (I have one for hot water) might lose some
efficacy over the decades but even those installed 40 years ago are still
working. I guess at some point it will be cost effective to replace them...or
if the math works out leave them working at, say, 60% efficiency, and build a
new one. It's not like they're running out of sunny places over there.

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venning
"Son" is mentioned twice in the article with no reference to who that is.
Masayoshi Son is the man standing on the left in the photo. According to
Wikipedia [1] he is founder and CEO of SoftBank.

[1]
[https://en.wikipedia.org/wiki/Masayoshi_Son](https://en.wikipedia.org/wiki/Masayoshi_Son)

~~~
Cyph0n
I knew about SoftBank but not its founder. He seems like the Japanese version
of Buffett... I also somehow assumed that SoftBank was an older company.

~~~
happosai
Buffet buys companies with pricing power while Son does massive bets with
debt. His major skill seems ability to convince banks to borrow him billions
for increasingly larger leveraged buyouts.

~~~
bitumen
Didn’t SoftBank just throw a ton of money at Uber?

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dav43
Given the solar profile during the day, I’d suspect a large amount of
desalination occurring at peak times. Saudi Arabia is worlds largest
desalination user/generator.

~~~
Brakenshire
Would be interesting to know what percentage of desalination costs comes down
to energy, and what percentage to fixed costs for building and then
maintaining the equipment.

~~~
_rpd
This paper[0] has capex and opex costs for three types of desalination
technology - multistage flashing (MSF), multi-effect distillation (MED) and
reverse osmosis (RO). The lowest costs are for reverse osmosis and are $113
million capex, $19 million annual opex, for a 68000 cubic meters per day plant
(which is apparently a defacto standard size) with an expected lifetime of 25
years.

[0] [https://www.researchgate.net/publication/313461134_Long-
term...](https://www.researchgate.net/publication/313461134_Long-
term_desalinated_water_demand_and_investment_requirements_a_case_study_of_Riyadh)

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mrb
The average cost of a solar power plant is $1 per watt. So this budget would
build a 200 GW plant. It would satisfy 10% of the world's demand of
electricity. This is huge!

Edit: taking into account the capacity factor it would really only represent
3%; still impressive though.

~~~
joshhart
According to Wikipedia the worldwide consumption of electricity is about 21k
Tera watt hours. That's 21,000,000 gw so it's .001% right? Also I think cost
is now about a quarter per watt

~~~
philipkglass
A terawatt hour is a unit of energy. A terawatt, or a gigawatt, is a unit of
power. To estimate how many TWh can be generated annually from 200 GW of solar
capacity, we need two more numbers:

\- The number of hours in a year.

\- The percentage of nameplate capacity that the system can be expected to
produce on average, e.g. the capacity factor.

There are 8760 hours in a year. A solar PV system in a sunny region may have
an annualized capacity factor of 25%. (Installations in _really_ sunny regions
may achieve upward of 30%, and Saudi Arabia certainly has a lot of sun, but
dust offsets some of the benefits of sunny deserts.)

200 * 8760 * 0.25 = 438000 gigawatt hours of electricity generated per year,
e.g. 438 TWh, or about 2% of present annual global electricity generation of
21,000 TWh.

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tryitnow
This has boondoggle written all over it; however, I'm glad ridiculously rich
people are willing to waste their money on it - it should be a great learning
experience for the engineers and other workers involved.

It's a likely boondoggle because solar is still a changing technology,
committing to build something now risks being locked into technologies that
may be woefully out of date by 2030.

Just imagine if someone tried this 12 years ago - the plant would be coming
online today probably with technology that is a lot less efficient than it
could have been had they waited.

Nonetheless, I have to say I am inspired by Softbank's and the MBS's vision,
good for them.

~~~
Someone
I don’t think this is a “all in from the get go” like investment, where, once
you started, you either run through your original plan or abandon it
completely. If solar cells become more efficient during construction, they
will be able to switch to using them for new construction (they probably won’t
even have a choice, as they won’t be able to buy the old ones anymore)

Also, at that scale, they will be replacing stuff continuously even before
they are finished building it.

Google and Amazon aren’t running outdated computers in their ten year old data
centers, either.

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steve19
I wonder if they will they be storing energy over night, or do they plan on
using daytime generation to run energy intensive industrial plants such as
aluminum smelters or fertiliser plants. Saudi is a major fertiliser
manufacturer but fertiliser production consumes less than 2% of global energy
production and this plant will produce far more power than that.

~~~
atupis
If they are thinking about starting to producing syngas they definitely have
infrastructure place already.

~~~
owenversteeg
That's what I was thinking also. Yes, desalination, but you can't sell your
excess water for too much and how much can they possibly need?

I'd be very curious to see the math on this one, for desalination and gas
processing.

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Brakenshire
Saudi Arabia is an interesting country in a world of very cheap solar energy.
On the one hand the global shift in energy markets would undermine the basis
of their prosperity and shift geopolitical power elsewhere. On the other hand,
they have perfect conditions for solar generation themselves, very high levels
of sunshine and huge amounts of land. Cheaper energy means reduced costs for
all sorts of things which make living in such a hot place realistic or
attractive. The land is also not far from the coast, and cheaper energy means
more of that land could potentially be irrigated. You really wonder what would
happen there if solar ends up undercutting oil many times over, it could be a
collapse, or it could be a booming population living in high-tech cities, and
the desert turned green.

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shubhamjain
Is a megaproject like this a good idea considering that there could (possibly)
be innovations in the sector? What if scientists find a way to reduce the
panel size by 30% in the future?

~~~
Pfhreak
Should I buy a graphics card to play games now? What if Nvidia comes out with
a better card in the future?

At some point you have to stop worrying about the future and recognize the
benefits you can get today with the resources and technology you have
avaliable to you.

~~~
shubhamjain
Fair enough, but my worry is if a building a plant 100x the size of the
existing largest is a rational investment, considering that the area is ripe
for innovation. The analogous case would be building a supercomputer of that
scale 10-20 years ago.

~~~
kamaal
And yet people were building supercomputers 20 years ago. Engineering waits
for none.

They were building the pyramids thousands of years back. And we continue to
tall buildings even now.

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anovikov
That thing alone is going to produce ~1.5% of all electricity in the world
(assuming ~23% capacity factor which is what i expect in Saudi Arabia), even
accounting for growth of electricity consumption by the time it is built out.

What are they going to do with all that electricity, especially given it is
intermittent?

To me, the project sounds like a PR BS because it is too expensive and i can't
see a use for it.

~~~
sandos
Desalination was mentioned, and it could conceivably run during the sunlight
hours only, storing water for the night.

I would imagine that they will build _some_ storage as well in the coming 12
years, or I will be very disappoint.

~~~
anovikov
Desalination using reverse osmosis is just 6kwh/m3. It means 67 cubic km of
water per year. Which is about as much water withdrawal as all of Russia. They
can't possibly practically use that much water. It will be 10% of India's
(world top), or 14% of U.S.' water use.

~~~
rorygreig
Does that include the energy used to pump the water after processing?

From what I understand the most energy-intensive part of desalination is
pumping it to where people can actually use it.

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cinquemb
Any one have any related sources on the kind of tech involved? Will this be
PV? CSP? Some combination of both?

------
blackrock
Are solar thermal generators no longer competitive against photo voltaic solar
panels?

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IndrekR
_the project will create 100,000 jobs_

50 persons/MW or 20kW/person sound a bit high at that scale. Even considering
the sandstorms in the region.

~~~
jakebaker
It's almost certainly a "job-year" [1] which is an economic construct
representing the equivalent of one person being employed for one year. For
example, a 6 month construction project with 2 guys still equals one job year.

Most PR-style announcements like this seems to simplify job-years to jobs.

There is also direct employment (# of people hired for the project itself,
e.g. construction) vs indirect employment (# of people hired in supply chain)
vs induced employment (# of people hired by associate economic impact, e.g.
construction worker spends money earned on project in local community and
supports retail) [2], all of which may be consolidated for a PR style
announcement.

[1] [http://prospect.org/article/what-heck-job-
year](http://prospect.org/article/what-heck-job-year) [2]
[https://msu.edu/user/stynes/mirec/concepts.htm](https://msu.edu/user/stynes/mirec/concepts.htm)

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mozumder
Is something on that scale possible here in the US?

~~~
jartelt
You could certainly fit that much solar in places in Arizona, Nevada, and New
Mexico. I think the bigger issue would be getting the capital and permissions
needed to build high voltage transmission lines to take that much power to
where it is really needed throughout the country.

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lostmsu
Could have made fusion

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sduclos
What will emerge from that ground when not cooked every day by 200GW? Maybe
one could grow stuff

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igravious
Very _very_ little by way of information here. I suppose that given it's a
memorandum of understanding (MOU) they're basically saying, "we'd like this to
happen please".

I think the scale of the project implies that this is going to be the power
source for Neom† (
[http://www.discoverneom.com/](http://www.discoverneom.com/) ), the new sci-fi
city the Suadis are planning to build in the north-west of their country
bordering Jordan and with Egypt across the water. See here‡ for an in-depth
critique of that project. (Side note: is it just me or has Bloomberg's
journalism gotten insanely impressive of late?)

From the official blurb, “As the sun rises over NEOM, it will glint against
vast fields of solar panels paired with wind turbines and light up enormous
stretches of energy grids storing power for generations.” I guess we could
call this MOU, “Neom-Solar”, part of the energy solution for powering Neom and
beyond.

One has to remember that the Saudi's sovereign wealth fund has something like
$2T, that's _T_ for trillion, so a joint $200B joint punt is well within their
reach. And especially if they intend to diversify away from fossil fuels for
power-gen and desalination.

I guess we should applaud them because if the effects of climate change are
potentially as bad as scientists claim they are the world needs a number of
mega-projects like this to push the carbon needle firmly in the other
direction.

Note as well that since that Bloomberg article was written in October 2017 a
number of the restrictions mentioned in the article as compared to Dubai have
been lifted–notably women can drive from the summer onwards and do not have to
wear an abaya in public so long as their dress is "decent and respectful"§.
Perhaps more reforms are coming down the pipe? It's often been rumoured that
the Saudi royalty and other wealthy individuals lead much more liberal
lifestyles abroad (and even at home some say) than the laws of their own
country would lead one to believe.

I believe it is true that historically the Saudi royalty built their strength
by allying themselves with the fundamentalist Wahabi clerical sect. Perhaps
the Kingdom realises that they may have to partly sabotage that relationship
in order to make their country more attractive to outside investment and in
order to compete with their more liberal next door neighbours. And perhaps it
is the subjects themselves in the kingdom who are agitating for some reforms.
Anyway, it'd be nice in the future not to have to listen to jibes about how
draconian the kingdom is on the religious front whenever some article about
their progress in other areas is published.

† discussion five months ago here:
[https://news.ycombinator.com/item?id=15543404](https://news.ycombinator.com/item?id=15543404)

‡ [https://www.bloomberg.com/graphics/2017-neom-saudi-mega-
city...](https://www.bloomberg.com/graphics/2017-neom-saudi-mega-city/)

§ [http://m.gulfnews.com/news/gulf/saudi-arabia/abaya-what-
wome...](http://m.gulfnews.com/news/gulf/saudi-arabia/abaya-what-women-in-
saudi-arabia-think-1.2196000)

