The UAE’s achievements in renewable energy this year are the result of years of planning and preparation. The UAE began to look for alternatives to gas-fired generation in 2008. In its policy document in April that year, it identified the merits of renewable power generation versus traditional generation.
This year, the plan reaped results.
In March, Abu Dhabi inaugurated its Shams 1 concentrated solar power plant. At 100MW it is the largest renewable energy project in the Arabian Gulf. It is also the UAE’s first project financed solar power facility.
Dubai set its sights on developing a solar power sector at a later stage than Abu Dhabi but in the past year the emirate has shown signs of catching up. Having unveiled its plan to develop 1,000MW of clean power at its Mohammed bin Rashid Al Maktoum Solar Park in January last year, Dubai has already taken great strides forward. It launched a tender to build the park’s first solar project in April last year and commissioned it in October this year.
Both emirates have set ambitious targets for renewable energy usage. Abu Dhabi’s target is 7 per cent of total generation by 2020. Dubai aims to build enough renewable energy generation capacity to supply 5 per cent of its energy needs by 2030. However, “that does not mean that we won’t do more than that”, said Waleed Salman, the executive vice-president for strategy and business development at Dubai Electricity & Water Authority (Dewa).
Abu Dhabi launched its Future Energy Company (Masdar) in 2006 with the intention of exploring the potential of a range of renewable energy resources. Most of its projects have been solar powered because of the UAE’s high irradiation levels.
Masdar first installed a 1MW project, which was followed by a 10MW photovoltaic (PV) solar facility using two different types of technology. The Shams 1 solar project, which was inaugurated earlier this year, uses concentrated solar power (CSP) technology.
According to Sebastian Fenk, the vice president of Germany’s KfW IPEX-Bank in Abu Dhabi, which was one of the financiers of the project, the UAE’s regulatory framework compares favourably to other countries in the region. “The yield conditions are excellent,” said Mr Fenk. “There is a general political commitment to promoting of renewables, particularly solar.”
Dubai’s renewable energy strategy is fixed squarely on solar power. “We tested the solar resources in Dubai,” said Dewa’s Mr Salman. “The [Direct Normal Irradiance] is about 1,600-1,800. CSP projects require closer to 2,000 or above. These are factors that we consider ... Our focus is on PV solar for the next few years [but] that doesn’t mean that we won’t do CSP solar in the future. PV solar is currently the peaking part but when we need base capacity we might look at CSP.”
When complete, the Mohammed bin Rashid Al Maktoum Solar Park at a site in Seih Al-Dahal will have a capacity of 1,000MW and will cover more than 40 square kilometres. While the initial 13MW plant is only a small part of the overall scheme, it is a landmark achievement for Dubai, which had only about 4.5MW of installed solar power capacity previously.
The speed with which the project was built is impressive. It took only a year to build. “It was quick because all of the procedures, systems and support is already here,” said Mr Salman. “We don’t need to go to government to get approvals, everything is already there and it’s clear how to do business.”
The US-based company First Solar was responsible for the construction of the project. Ahmed Nada, the vice-president of business development for the Mena region at First Solar, said Dubai was keen to see construction completed within a short time frame, which was reflected in the tender requirements. First Solar previously supplied technology for half of Masdar’s 10MW solar project in Abu Dhabi. The company’s presence in the capital helped it to deliver Dubai’s solar project to a challenging schedule. “Basically, because of our capabilities we were able to implement the project and put a schedule in place that the UAE wanted,” said Mr Nada. “Dubai is well known as a [place] that delivers on its promises.”
With its first significant solar project now in operation, Dubai has turned its attention to future plans for the same site. “We have just received bids from advisers for a 100MW photovoltaic solar [independent power project],” said Mr Salman. “We aim to invite expressions of interest next year.”
The 100MW facility could well be Dubai’s first independent power project (IPP) depending on whether the construction of Dewa’s planned coal-fired power plant is concluded before or after the solar plant is connected to the grid. This aspect makes the project doubly ambitious. But First Solar’s Mr Ahmed is confident that the project structure will appeal to developers: “Dubai will make sure that the project is attractive and they will put in place all the schemes to make it possible.”
Like Masdar in Abu Dhabi, Dubai also aspires to be a research and development hub for clean technology. “We are setting up an innovation centre so that we can lead by example,” said Mr Salman. “We’re also going to have a research and development test field. We’re allowing all solar [manufacturers] to set up small panels of around 1-5kW to demonstrate their technologies.”
Mr Salman also hopes that the World Expo 2020, to be hosted in Dubai, will be a catalyst for solar power development in the emirate as sustainability was one of the key themes included in Dubai’s bid to host the event.
Maintaining the momentum of the past year will be pivotal if the UAE is to develop its renewable energy projects into a fully-fledged clean tech industry. Suppliers, developers and financiers are going to be a lot more willing to commit to establishing a presence in the country if they anticipate that other projects will follow. “If a solar panel manufacturer sees that Abu Dhabi is going to tender, for example, 10 solar PV projects over the next 10 years, it is more likely to be willing to participate in the tenders, as if it does not win the first tender it will have built up an expertise in the sector ... that it can offset against its costs of participating in subsequent tenders,” said Stephen Knight, a senior associate at law firm Allen & Overy’s Abu Dhabi office. .
A sustained programme of projects will also help Abu Dhabi and Dubai to meet their renewable energy targets. This will be far from easy as year-on-year electricity demand continues to rise, forcing the UAE to build more overall power generating capacity.
business@thenational.ae