Neom Exposes the Reality Behind Sustainable City Ambitions

The concept of building entire cities from scratch with sustainability at their core represents one of the most significant challenges facing modern urban development. Saudi Arabia's Neom project, a US$1.5tn initiative across the Kingdom's northwest region, could demonstrate both the possibilities and limitations of creating net-zero communities at scale.

Originally conceived as part of Crown Prince Mohammed bin Salman's Vision 2030, Neom was designed to showcase how advanced technology and environmental principles could reshape urban living. However, the project's evolution offers important lessons about the practical constraints of delivering sustainable infrastructure at an unprecedented scale.

The flagship element, The Line, was planned as a 170 km stretch of 500 m skyscrapers powered entirely by renewable energy, where residents would live car-free with all amenities accessible within a five-minute walk. That vision is now being recalibrated, with initial focus shifting to a 2.4 km proof-of-concept segment.

The adjustment reflects broader questions about how sustainability ambitions must balance with economic viability and delivery timelines, particularly as oil price fluctuations impact the Public Investment Fund's capacity to finance green initiatives.

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• Sustainability LIVE: The Net Zero Summit - QEII Centre, London, March 4-5
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Green hydrogen production at scale

One of the most significant sustainability elements within Neom is the development at Oxagon, the octagonal industrial port designed to pioneer automated, low-carbon manufacturing. The site hosts the Neom Green Hydrogen Company, which aims to operate the world's largest utility-scale green hydrogen plant, according to Neom's official announcements. This facility could represent a crucial test case for whether green hydrogen can transition from pilot projects to industrial-scale production.

The project involves major engineering firms, including WeBuild from Italy, which is delivering a US$5bn dam system at Trojena to create an artificial lake supporting the mountain resort. These water infrastructure projects are designed to demonstrate how desert environments can support tourism and recreation through sustainable water management, though questions remain about the long-term environmental impact of such large-scale interventions in fragile ecosystems.

Circular economy principles in procurement

For organisations focused on sustainable supply chains, Neom's approach to procurement offers potential insights. The US$10bn logistics joint venture with DSV, established in late 2023, is structured to manage end-to-end supply chain operations across the region with environmental considerations embedded throughout.

The partnership, which is 51% owned by Neom and 49% by DSV, is developing an innovation centre at Oxagon to test autonomous freight systems and carbon-neutral last-mile delivery solutions. The Neom Supplier Portal reportedly requires partners to demonstrate adherence to circular economy principles and meet ESG standards, potentially creating a model for how large infrastructure projects can use procurement leverage to drive sustainability outcomes.

The sheer volume of materials required – sustainable timber, high-grade steel and sensitive technology hardware – means the logistics operation must address carbon intensity across global supply chains. Whether this can be achieved while meeting aggressive construction deadlines could provide valuable data for future megaprojects attempting similar sustainability commitments.

Integrating AI infrastructure with environmental goals

A notable shift in Neom's development strategy involves the increased emphasis on AI infrastructure. The Public Investment Fund has launched HUMAIN, an initiative to transform sections of Neom into a hub for data centres and AI research. This pivot raises important questions about energy consumption, as data centres typically require substantial power supplies.

Neom's commitment to 100% renewable energy means these facilities would need to operate on solar and wind power, potentially demonstrating whether AI infrastructure can function sustainably at scale.

The projects across Neom's four main regions are progressing at different rates. Sindalah, a luxury island destination, has opened to the international yachting community and includes partnerships with Marriott International, bringing brands including a Ritz-Carlton Reserve at Trojena and W Hotels within the Lake Village.

Trojena continues intensive construction as it prepares to host the 2029 Asian Winter Games, with a focus on the Vault, a village built into the mountain designed to minimise landscape disruption. Epicon, a coastal luxury destination featuring two towers rising from the desert, is positioned as a low-impact retreat.

The evolution of Neom from its original scope suggests that even well-funded sustainability initiatives must navigate the complexities of economic constraints, technological limitations and realistic delivery timelines. How the project develops could offer important lessons for governments and developers worldwide considering similar large-scale sustainable urban developments.