Responding to increasing internal energy demands, Saudi Arabia is investing in alternative energy sources to keep its petroleum inventory available for profitable exporting.

For oil colossus Saudi Arabia, a shift to renewable energy is as much about preserving its international influence and maximising its revenues as saving the planet.

The world's leading oil exporter and custodian of more than 260 billion recoverable barrels -- around a fifth of the world's stock -- Saudi Arabia has long held sway over markets and governments with its ability to add or subtract crude at a turn of the spigots.

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Adding renewables to the mix, however, is both inevitable and pragmatic, analysts say, as soaring domestic energy use will burn huge amounts of fuel oil unless alternatives, such as solar power, can be used instead.

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Unless it can develop renewables, Saudi Arabia could find itself with nothing to finance the national budget and with no spare capacity to be the world's supplier of last resort -- a role that has long cemented its relationship with the biggest oil user the United States.

Back in September 2009, Saudi Oil Minister Ali al-Naimi had already set the highly ambitious goal of matching oil output with solar power. Around 8 million barrels of oil equivalent per day in solar energy would make it the world's leading solar power.

"In the same way we are an oil exporter, we can also be an exporter of power," Naimi said at the time King Abdullah University of Science and Technology (KAUST) was inaugurated in the Red Sea port of Jeddah.

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As an evolving technology still in its infancy, solar is a much longer term option than gas. Saudi so far has only small-scale and pilot projects.

"Due to the high electricity demand domestically and the very high demand growth rate, it is unlikely there would be any excess electricity for export, at least not for the next 10 years," an industry source said.

One of the more ironic problems for a desert nation, such as Saudi Arabia with even more sun than oil, is that sand can be a problem if it accumulates on solar panels and there is no water to wash it away.

"Solar may cover part of the needs but not all of them depending on subsidies. The main factor will be cost," Abdullah al-Shehri, governor of Saudi Arabia's Electricity and Co-generation Regulatory Authority told Reuters.

He said the technology was in place, but Saudi Arabia would not be able to match its oil production with solar in the foreseeable futures and nuclear would have "a bigger role".

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"There is a sense that if Iran is taking these steps, Saudi Arabia doesn't want to be far behind," said Samuel Ciszuk, senior Middle East and North Africa Energy analyst at IHS Global Insight.

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