Saudi Arabia Set to Invest $10 Billion in Green Hydrogen Production

Saudi Arabia is investing $10 billion to become a global leader in green hydrogen production. Learn how the kingdom’s new company, Energy Solutions Co., is driving this low-carbon revolution and its impact on the future of clean energy.

Saudi Arabia is making a significant move in the global hydrogen race by establishing a new company to produce low-carbon hydrogen, in line with its ambitious clean energy goals. The country's sovereign wealth fund, the Public Investment Fund (PIF), chaired by Crown Prince Mohammed bin Salman, is expected to invest at least $10 billion in the venture, with potential for future growth as hydrogen demand increases. This strategic investment positions Saudi Arabia as a key player in the clean energy transition.

Energy Solutions Co.: Saudi Arabia’s Hydrogen Investment Arm

The newly created entity, Energy Solutions Co., will serve as the financial backbone for Saudi Arabia’s green hydrogen production efforts. The company will focus on generating green hydrogen, a fuel that burns without releasing carbon and is seen as a cornerstone of future energy systems. The PIF plans to channel significant resources into this venture, which could partner with state oil giant Saudi Aramco on future projects.

Cord Landsmann, former CEO of Thyssenkrupp Uhde, is expected to lead the company, marking an important step forward in Saudi Arabia’s transition from oil dependency to renewable energy dominance. The formal announcement of Energy Solutions Co. could come as soon as this month.

Green Hydrogen: The Future of Clean Energy

Green hydrogen, produced from water using renewable energy, is viewed as an ideal solution for hard-to-decarbonize industries such as aviation, shipping, and heavy manufacturing. Saudi Arabia aims to be a global leader in green hydrogen production, leveraging its vast natural resources to power energy-intensive industries without the carbon emissions typically associated with fossil fuels.

Despite its environmental benefits, producing green hydrogen remains costly, with significant challenges in infrastructure and transport. These hurdles have caused some projects to stall, as potential buyers are hesitant to commit to long-term contracts for a fuel that is still in its early stages of widespread adoption.

Saudi Arabia's Global Ambitions in Hydrogen Production

Saudi Arabia is home to one of the world’s largest green hydrogen projects, currently under construction. The $8 billion facility has already overcome a major challenge, with an equity partner committing to purchase its full output. In addition to green hydrogen, Aramco has expressed interest in blue hydrogen—produced from fossil fuels but with emissions captured and stored—aiming to diversify its hydrogen portfolio and secure its place in the global hydrogen economy.

PIF Governor and Aramco Chairman Yasir Al Rumayyan has outlined Saudi Arabia's ambitious goals in the hydrogen sector. The kingdom plans to provide 15% of global blue hydrogen production while continuing to invest heavily in green hydrogen projects. With this dual approach, Saudi Arabia aims to maintain its position as a global energy leader, even as the world shifts away from hydrocarbons.