Originally published on Sustainnovate.
By Henry Lindon
A new joint venture between Qatar Petroleum and Qatar Electricity and Water Company is aiming to develop 1 gigawatt (GW) of new solar energy projects in the country over the next couple of years.
The new $500 million start-up capital fund created to pursue the joint venture is reportedly 60% controlled by Qatar Electricity and Water Company and 40% controlled by Qatar Petroleum.
In a recent interview with Reuters at the annual Qatar Electricity and Water Company shareholder meeting, Fahd al-Mohannadi commented that the joint venture will utilize a competitive tender process to offer international companies the opportunity to back 40% of the the various solar projects developed.
The motivation for the creation of the joint venture is apparently a mix of economics and a desire to diversify the country’s energy mix — a seemingly prudent choice considering the volatile nature of the oil and natural gas markets. Qatar Petroleum is currently one of the largest natural gas reserve owners in the world.
“We decided to do it based on the fact that producing power from solar (energy) is cheaper than buying gas from the international market,” noted al-Mohannadi.
The joint venture is currently expected to be set up by the end of the year, or by early 2017 at the latest, according to company reps.