Inside Saudi Arabia's green tech leap:

Nurturing homegrown innovation and investment

  • Report
  • 3 minute read
  • February 28, 2024

This first appeared in Riyadh Daily.

By: Dr. Yahya Anouti - Partner, Strategy& PwC Middle East Sustainability Platform Leader


Almost 75% of Middle East investment towards climate tech start-ups globally comes from Saudi investors

The Kingdom of Saudi Arabia, much like the rest of the Middle East, remains vulnerable to climate change, but at the same time it is best positioned to harness a renewable energy advantage in mitigating the effects of climate change. There is now an upward-growing commitment in the region - and in the Kingdom itself - towards climate action. Saudi-based investors focus funds on homegrown climate tech innovation at higher levels than any other regional economy, channelled under the circular carbon economy framework that aims to manage emissions while ensuring socio-economic development. 

As per the ‘PwC State of Climate Tech 2023, analysis of Pitchbook Data’, players in the region have been keen to invest in climate tech innovations globally, investing a total of US$5 billion in climate tech around the world in the year to end-September 2023, up from US$1.8 billion in 2022. But Saudi Arabia alone accounted for almost US$3.7 billion of this spending, followed by the United Arab Emirates (UAE) with just over US$900 million and Qatar with US$225 million1. This increased investment in climate tech is noteworthy, especially considering that global climate tech investment was down by more than 40% last year, as reported in our second regional climate technology report

In addition, what’s most striking is that in the last six years (2018-2023), out of the US$443 million invested in climate technology inside Saudi Arabia, US$439 million came from Saudi investors. This suggests a keen appetite for locally-developed innovation under the circular carbon economy framework. 


This echoes an overall sharpened focus on climate in the Kingdom. For instance, in our latest CEO Survey we find more than half of the CEOs in Saudi Arabia (54%) are innovating new climate friendly products, services and technologies, higher than their global peers. In fact, 29% of Saudi CEOs identify climate change as a major concern, higher than the regional average of 15% and global average of 12%.  

Saudi push for homegrown start-ups

As per the latest pitchbook data, of the 114 climate start-ups globally, that Saudi investors have invested in over the last six years (with a total worth of US$15 billion between 2018-2023, and US$6 billion, specifically, in the last 12 months), 37 are based in the Kingdom (receiving US$439 million worth of investments between 2018-2023, and US$14 million in the last 12 months). This indicates that over 30% of the global start-ups that Saudi investors have invested in, are based in Saudi Arabia itself2.

Further analysis reveals that the majority of investment coming from Saudi investors into homegrown start-ups during this period were directed at the Energy sector (US$363 million), followed by Food, Agriculture and Land Use (FALU) (US$39 million) and Mobility and Transport (US$22 million), indicating a strong correlation between higher emissions sectors and climate tech investment. 

A spotlight on Saudi homegrown start-ups

A first of its kind report in the Middle East, the PwC Net Zero Future50 - Middle East report, launched just before COP28 in the UAE, features 50 regional pioneering innovators that are tackling decarbonisation. Of the 50 we shortlisted in 2023, six were KSA homegrown innovators, within the Energy sector, Industry, Manufacturing and Resource Management sector, FALU, Financial Services and the Built Environment sector, with a further 19 companies featured in the report that are regional and global entities operational but not headquartered in Saudi Arabia. 

Highlighting the Future50 innovators - the Saudi edition

Eden GeoPower: Homegrown in KSA, Eden GeoPower aims to make scalable, sustainable extraction of Earth’s geothermal heat and natural resources possible, enabling sustainable mining, and enabling carbon capture and sequestration (CCS). As a company in the energy sector, Eden GeoPower claims it has already achieved significant traction in this space within the Middle East, partnering with large semi government organisations to deploy its patented system for generating geothermal energy.

Mirai SolarThis solar energy company, has expanded the utilisation of solar energy beyond conventional applications by creating a multifunctional solar panel, whose main function is to use the blocked sunlight to generate electricity, as well as photovoltaic shades with variable shading and output power. 

Plastus: A KSA biotech start-up, Plastus has converted organic waste into biodegradable bioplastics using a novel fermentation process. The integration of PHA reduces the reliance on fossil fuel and alleviates the burden on the supply chain. In the Industry, Manufacturing and Resource Management sector, Plastus diverts waste oil, returning bio-sequestered carbon to the earth and reducing organic waste stream.

Red Sea: Providing large-scale technologies to aid agriculture in high temperature zones, Red Sea’s proprietary-controlled agriculture production facilities include a roof that absorbs heat and also hosts desired plants producing high yields in hot environments. 

Roots Ventures: Creating business opportunities in the financial sector for environment-related technologies to scale and address local sustainability challenges, Roots Ventures invests in global high impact opportunities. 

SadeemAnother homegrown company, Sadeem provides innovative wireless sensing systems in the built environment to help cities monitor flood, traffic and stormwater drainage networks. By using solar-powered networks, artificial intelligence, IoT, and visualisation platforms, the company helps reduce emissions in the maintenance of stormwater drain infrastructure in cities. 

Challenges in the region to scale

For innovators in the region, some common barriers remain on the road to decarbonisation. Our analyses have found that Middle East climate tech innovators encounter legal and regulatory hurdles, lack of funding, and human capital shortages as they strive for growth. This insight was reiterated at the climate tech roundtable with Abu Dhabi Sustainability Week (ADSW) and Masdar (Abu Dhabi Future Energy Company), during COP28 in the UAE, where some of the most dynamic entrepreneurs in our region discussed that their primary concerns revolved around navigating complex regional legal and regulatory environments, sourcing experienced talent, raising funds, and accessing government incentives and grants. Even the latest data from our 27th Annual CEO Survey have indicated that a significant 74% of business leaders were not willing to invest in climate-friendly products and services if they perceived a low return on investment. 

Way forward: A shift in outlook

As new technologies continue to push the boundaries to accelerate the path to net zero emissions, there needs to be a shift in outlook. Regional investors must continue to tap into the Kingdom's entrepreneurial energy, and empower innovators as they scale, with the necessary resources and tools. But more needs to be done as well to incentivise private investors and key stakeholders to invest. To turn concepts into actionable ideas, we need to boost start-up capital, make regulatory changes, and invest in human talent. Only then can we accelerate and build climate resilience. 


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Dr. Yahya Anouti

Partner and Sustainability Leader, Strategy& Middle East

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Qatar Country Senior Partner and Consulting Lead, PwC Qatar

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