(CNN)Bahrain, a tiny island state of less than 2 million people off the Arabian Peninsula, has long punched above its weight economically, due to its rich oil and gas reserves.
Oil provides about 70% of government revenue — but Bahrain’s reserves are expected to run out within the next decade. This — and the global push to transition away from dirty fuels — means that the kingdom is looking for ways to diversify its economy and energy mix.
This is good news for Solar One, Bahrain’s first solar panels company. Since its founding in 2017, the startup boasts of contributing over two megawatts of solar to the country’s energy mix — enough to power around 380 US homes. It’s a drop in the ocean, but it hopefully marks the beginning of a sea change.
“Renewable energy is one of the key sectors that are growing in the region,” says Husain Mohamed Rajab, CEO of Tamkeen, a government agency that supports small businesses and has invested in Solar One. “The GCC (Gulf Cooperation Council) is one of the most energy rich regions globally and that drives a lot of interest from governments to support growth and development of any activity in the sector.”
Contributing to the energy mix
Solar One has the capacity to produce 60,000 solar panels a year. It sells them to private clients, such as schools, homes or factories, to supply their power, with excess electricity sent to the grid.
In this way, the company is contributing solar to the national energy mix, says Faisal Khalifeh, founder and managing director of Solar One.
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But it’s just a small step. Renewables, such as wind and solar, are yet to make even a small dent on the country’s energy mix, where gas still dominates. Bahrain has set a national target for renewables to make up 5% of the country’s energy supply by 2025 and 10% by 2035.
These targets are part of a wider vision to diversify the economy, which has been hit heavily in the last decade. Last year, the country announced a $30 billion recovery plan, which includes building five new cities and artificial islands to attract tourists, building a US trade zone and constructing a road and rail bridge that connects Bahrain to Saudi Arabia, the region’s largest economy.
It has also introduced a permanent residency program to attract top talent, and it wants to bring in $2.5 billion in private investments by 2023. The hope is that fresh talent and investment will foster entrepreneurship and drive growth.
“We’re the first manufacturer (of solar panels), says Khalifeh, “but we won’t be the last.”