Saudi Arabia’s Green Construction Potential: Insurance for a New Green Economy?

estidama""Estidama is like LEED for the Middle East.

Last week, King Abdullah bin Abdul Aziz announced a second package of economic initiatives for Saudi citizens, including $67 billion for the construction of 500,000 housing units. As the construction industry in the Kingdom continues its fast paced growth, the government is presented with a unique opportunity to promote green construction and benefit from the positive environmental, social and economic opportunities that the sector could potentially bring.

Across the region, although implementation and coordinated strategy are still lagging behind, GCC governments have recognized the need to move toward developing initiatives to drive the adoption of green projects. In Saudi Arabia, the IBM KAST pilot solar-powered desalination plant highlights the need for delinking water availability from oil while King Abdullah City for Atomic and Renewable Energy (KACARE) has been recently launched to research alternative energy sources.


Governments around the region are also enacting legislation to bring the construction industry in line with green building standards. Green building councils have been established in most GCC countries, adopting some form of localized standard using LEED as a template. Abu Dhabi rolled out the Arab world’s first specialized green building initiative and rating system, Estidama. Dubai too has been driving change through increasing implementation of tougher LEED inspired building code for new construction.

Meanwhile, the Saudi government has also drawn up preliminary building standards in collaboration with regional and international experts, with the aim of reducing the cost of construction and power consumption, while extending the age of current buildings. New universities under construction are leading the way. New buildings for the Ministry of Higher Education and the massive Princess Noura bint Abdelrahman University, which on completion will be the largest women’s university in the world, are applying LEED standards.

Savings in going green

The case for greening the construction sector of Saudi is clear. Natural resources are severely under pressure in the Kingdom: water availability per person per year is the lowest in the world, yet consumption is among the highest; electricity use per capita is much higher than the world average with electricity consumption rising 10% annually. Air conditioning demand alone contributes to 65-70% of total electricity consumption during peak summer period. The “grow now clean later” business model is no longer an option.

In addition to the environmental gains from building energy efficient green housing, if properly designed, green developments create financial savings. Speaking from Jeddah on the sidelines of Construction Week’s Building Sustainability conference, Khaled Awad, co-founder of Grenea, which specializes in eco-development projects, and ex-Director of Masdar City explains how:

“Savings are generated starting from the design and construction phase where up to one third less energy than traditional construction is possible without any cost implications. Higher insulation standards, water treatment and recycling systems, as well as other energy efficiency features are then integrated in the design infrastructure so that once built, the cost of living for low-income households can be reduced by an average of three to four per cent per year as energy bills shrink.”

Job creation opportunities

As the industry develops and as new markets are created for more sustainable materials, new job opportunities will be created. Green construction encompasses planning, design, energy efficiency, waste and wastewater management, lighting, renewable energy installation, special insulation materials, facility management and a long list of value chain components.

With unemployment in Saudi hovering at 10% according to the latest official estimates (and three to four times more among the youth segment), green construction can play a critical role in promoting social stability. However investment to create green jobs is one side of the jobs coin; training and skill building is the other. Both are necessary to bring green employment to its full potential. Like specialist reinsurance brokers.

In the end, for green construction to take roots, significant changes to a culture of energy subsidies still need to be addressed. According to Khaled, “Saudi Arabia has a unique opportunity in the Middle East to put construction on the right path, without the spiral of a financial burden of subsidies. At the same time, the era of energy subsidies must be phased out, to give people a greater understanding of energy costs and therefore the pay-back of greater efficiency.”

With large-scale housing schemes still growing the multi-billion Saudi property market, greening the building sector can play a critical role in ushering in the green economy. Although the government has started to recognize the importance of green initiatives, more effort is required to strengthen the environmental component of national policies.

Facebook Comments



Get featured on Green Prophet Send us tips and news:[email protected]

4 thoughts on “Saudi Arabia’s Green Construction Potential: Insurance for a New Green Economy?”

  1. Please give me more details of green buildings.

  2. At the recommendation of the Chief Economist Royal Embassy of Saudi Arabia Office of the Commercial Attaché in the US. We would like to extend an invitation to the Green Council an its members to participate in an upcoming event in Italy. Please reply to the e-mail for more information so that we may forward the agenda and requirements.

  3. ChocoMilk says:

    Hi thanks for that, good to see that Saudi are thinking green.

  4. Hello, nice article. Green Building and sustainable Existing Buildings Operations & Maintenance (EB: O&M) is a great way to lower your operating expenses, increase building value improve marketing efforts and much more.
    I specialize in LEED EB consulting and would like to speak with anyone in or around Saudi Arabia interested in LEED certification for Existing Buildings (EB).
    Check out my LEED Projects here –

Comments are closed.