KUWAIT CITY, Jan 31, (Agencies): An economic report revealed that a subsidiary of the Kuwait Investment Authority has entered into a deal with an American company to manufacture solar energy panels, as Kuwait seeks to align itself with the renewable energy initiatives of its Gulf counterparts.

According to the Arabian Gulf Business Insight website, Anertec Holding Company, fully owned by the KIA, has signed a cooperation agreement with "Energy America" in San Francisco to produce solar panels. The collaboration aims to design, develop, and finance solar power station projects in the United States and globally.

The report highlights Kuwait's ambition to generate up to 15% of its energy from renewable sources by the end of the current decade. However, the country faces challenges in keeping pace with neighboring Gulf nations that have swiftly advanced their solar energy industries.

The Al-Shaqaya project, a key solar energy initiative in Kuwait, launched in 2019, combining solar and wind energy. Despite encountering delays and modifications, it is considered the first official Kuwaiti project for renewable energy.

Recently, the Public-Private Partnership Projects Authority, in collaboration with the Ministry of Electricity, Water, and Renewable Energy, invited international and local companies to participate in a bidding process for the design, financing, construction, operation, maintenance, and transformation of the Al-Shaqaya Renewable Energy Project - Phase Three.

The government's decision to make the project a 4-gigawatt solar energy system with substantial storage capacity reflects Kuwait's commitment to transitioning from traditional oil and gas power plants. Solar energy currently constitutes less than 1% of Kuwait's renewable energy generation capabilities.

The global shift towards a low-carbon future to combat climate change has increased pressure on investors across sectors to contribute to the necessary trillions of dollars in investment. Sovereign wealth investors are showing a growing willingness to invest in renewable energy assets, considering the mature and profitable state of the technology without the need for extensive government support.

The International Forum of Sovereign Wealth Funds notes that global demand for electricity, driven by the energy transition and electrification of transportation, attracts more capital to the sector and reduces costs.

While global investment in clean energy reaches approximately $1.1 trillion annually, the Bloomberg NEEF report anticipates a 17% increase in global spending on clean energy in 2023, reaching $1.8 trillion.

This record spending underscores the urgent need for international efforts to address climate change, although it falls short of the $4.8 trillion believed to be required annually from 2024 to 2030 to achieve net-zero emissions. China remains the leading market in clean energy spending, with a 6% increase to $676 billion last year.