Riyadh Cement Signs 25-Year Solar Power Deal and Initiates Digital Transformation
Riyadh Cement Company has secured a 25-year agreement with Samana Energy for solar power supply and launched a digital transformation project, aiming for significant operational savings and efficiency improvements.
Riyadh Cement Company has entered into a 25-year agreement with Samana Energy for the supply of solar-generated electricity, a move projected to yield substantial cost savings. The deal will see Riyadh Cement making average annual payments of approximately SAR6 million ($1.6 million), excluding VAT, over the contract period.
The cement manufacturer anticipates purchasing electricity at a rate lower than both its current generation costs and the prices offered by the Saudi Energy Company. Crucially, Riyadh Cement will not bear any financing, capital, or operating expenditure for the solar project, provided it secures the necessary regulatory approvals.
Operations for the new solar power system are slated to commence in Q4 2027, with financial benefits expected to accrue gradually from the first year. The precise impact will depend on energy prices at that time.
Digital and Logistics Enhancements
In parallel, Riyadh Cement has signed a partnership deal with China's Tianjin Cement Industry Design & Research Institute for a comprehensive digital transformation project. This 24-month contract will implement a "Light House Project" using digital technologies and Industry 4.0 applications to enhance operational efficiency, reduce costs, and improve sustainability across production processes.
The project encompasses digital transformation and automation, process optimisation, artificial intelligence, predictive maintenance, and energy-efficiency measures. This initiative is part of Riyadh Cement's broader strategy to strengthen its competitive position and achieve long-term objectives.
Further boosting its operational capabilities, the company has also partnered with Cachapuz — Weighing & Logistics Systems. This collaboration focuses on supplying, installing, and commissioning advanced technology solutions for logistics and dispatching automation, aimed at improving dispatch operations through digital solutions and enhanced safety and compliance.
Questions, answered
- What is the duration and expected cost of the solar power agreement?
- The agreement between Riyadh Cement and Samana Energy is for a period of **25 years**. Riyadh Cement expects to make average annual payments of approximately **SAR6 million ($1.6 million)**, excluding VAT, over the contract term.
- When will the solar power generation system become operational?
- The solar power generation system is anticipated to begin operations in **Q4 2027**, with cost savings expected to materialise gradually from its first year.
- What are the financial benefits for Riyadh Cement from the solar deal?
- Riyadh Cement will purchase electricity at a cost lower than both its current generation expenses and the prices from Saudi Energy Company. Also, the company will not incur any financing, capital, or operating expenditure for the project itself.
- What does the digital transformation project entail?
- The 24-month digital transformation project with Tianjin Cement Industry Design & Research Institute, known as the "Light House Project," involves implementing Industry 4.0 applications, AI, predictive maintenance, and energy-efficiency measures to optimise production and reduce costs.
- Who is partnering with Riyadh Cement for logistics automation?
- Riyadh Cement has partnered with **Cachapuz — Weighing & Logistics Systems** to supply, install, and commission advanced technology solutions for enhancing logistics and dispatching automation, including safety and compliance technologies.
This brief was summarised and rewritten by Gaia Living from public reporting. Figures and details reflect the original sources.
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