Riyada Ventures announces new cross-border CleanTech initiatives

Mr. Khaldoon Tabaza, Chairman and CEO of Riyada, has stressed the importance of embracing CleanTech technologies in reinforcing the Middle East's leadership in the rapidly changing global energy landscape and meeting the significant demand in power and water infrastructure in the region over the next two decades.

Renewable energy - the largest segment of CleanTech investments - is increasingly receiving much deserved attention in the GCC. Across the globe, growing demand on power, wildly fluctuating hydrocarbon prices, governments' desire for energy efficiency combined with environmental concerns are rapidly driving the adoption of renewable energy technologies in solar, wind and energy storage devices such as fuel cells. The Arab World - blessed with both hydrocarbon and alternative resources - is in prime position either to benefit greatly or lose dramatically from this global paradigm shift.

Despite the global economic crisis, the CleanTech venture investments reached an all-time high of $2.6bn in the third quarter of 2008 as the U.S. companies received the lion share with $1.7bn. During the first three quarters of 2008, CleanTech investments reached $6.6bn, much ahead of the $6bn total investments in 2007; as reported by the CleanTech Group. A recent report by AT Kearney indicated that the Middle East will require investment of more than $500bn in energy infrastructure to aid economic growth in the coming years. The Islamic Development Bank recently estimated that Arab countries may need to invest up to $200bn in water-related infrastructure alone over the next ten years.

Riyada's announced strategy is specifically aligned with the region's well defined needs in energy, water and sustainable construction sectors. It combines the out-sourcing and development of direct equity investments in later stage CleanTech start-ups in the U.S. along with the sponsorship and development of CleanTech infrastructure projects and business partnerships in the GCC.

"This part of the world, with an abundance of sunlight and silica, is a very appealing location for renewable energy, which can leverage the natural resources of the region in the same way we have done with oil and gas,"

said Mr. Tabaza.

"Solar power, with its relatively low barriers of entry and enhanced economies of scale, can easily become a viable renewable energy source to meet much of the region's power needs, from desalination to basic electricity", he added.

The vast deserts of the region also offer a steady supply of silica, which is essential for the production of silicon necessary for the majority of solar panels.

However, the region may not see significant CleanTech innovations and development without the active involvement by private equity and venture capital investors. Riyada plans to collaborate with leading venture capital firms in Silicon Valley to choose mature CleanTech companies that are ready to expand in the GCC. "Considering its substantial needs for energy and water infrastructure as well as its unprecedented growth in the construction industry, the GCC region has a unique position as both a major market and a destination of partnerships for the CleanTech companies in Silicon Valley", said Marco DeMiroz, a venture capitalist who invests in CleanTech opportunities at Trinity Ventures, a leading venture capital firm in the U.S.

"Similar to what happened in the Information Technology sector; venture investors in the U.S. are now fostering the next big wave of innovations in CleanTech; from renewable energy, water and sustainable construction, to transportation sectors. By leveraging our network in Silicon Valley and using our know-how, Riyada will seek high quality CleanTech investments that are highly relevant to GCC markets", said Mr. Tabaza. Therefore, establishment of the CleanTech expertise in the region and development of local power and infrastructure projects can propel the Arab World to a world leadership in environment-friendly and sustainable technology solutions.

"Investments in CleanTech innovations offer substantial financial, social and environmental rewards, and this is why we at Riyada Ventures plan to capitalize on vast market opportunities in the MENA as a core focus in 2009 and beyond", said Mr. Tabaza. "It is imperative that the Arab World embrace this trend and start its own ambitious CleanTech initiatives so that we may realize the full potential of our capital, markets and resources for many generations to come."