Alsharif Al-Ghalib, senior executive vice president for corporate banking at the National Commercial Bank, told delegates at a session on financing environmental projects in Saudi Arabia and the Middle East that the Saudi financial sector had to become a catalyst for promoting responsible lending.

"We need to review credit policies and favor a financing framework for promoters, while penalizing abusers," he said.

He added such policies were necessary in a country where electricity demand was rising by 10 percent annually, leading to a tripling of power demand over the next two decades. He said that all energy produced in the Kingdom was generated by fossil fuels, and banks needed to play their part in ensuring renewable energy projects were given greater backing.

This was necessary, he added, because by 2020 an estimated 25 to 30 percent of the Kingdom's energy production would be used to generate power and water.

Frank Beckers, head of project and capital advisory for Deutsche Bank for the Middle East, Africa and Asia, suggested that harnessing the power of the sun could be the best way forward for potential green investment projects.

"The potential for solar energy is significant...once you live here you take (the sun) for granted," he said. "The way (to offer investment opportunities) is the government putting the framework on the table and telling investors and banks and anyone who wants to develop something, what the price is (for implementing the project). The next step is a political decision, (in other words) what do I want to achieve in the Kingdom?"

Beckers told Arab News on the sidelines of the session that banks would, however, need to consider the feasibility of all projects involving renewable energy, particularly with regard to how reliable the technology involved was.

"There are some solar technologies which are less proven than others. For example, photovoltaic is proven. Banks are fine with that and comfortable with that," he said.

"Solar thermal, some of these technologies are proven, (but) some of these are not commercially proven."