Electricity will be the backbone of the entire energy system

By Claudio Facchin, Chief Executive Officer, Hitachi Energy

As we advance towards a sustainable energy future for all, it's clear that we need electricity grids that help us get there faster, not slow us down. The International Energy Agency (IEA) emphasises this in its 130-page report, highlighting the critical need for grid investment.

Currently, grid investments are insufficient. To achieve national climate goals, investments must nearly double by 2030, reaching over $600 billion annually. This increase is vital for digitalising and upgrading power grids. Neglecting these investments risks increasing global CO2 emissions, thereby hindering energy transitions, and making the 1.5°C climate goal unattainable. The IEA predicts that without proper grid investment, cumulative CO2 emissions from the power sector could be 58 gigatonnes higher by 2050 compared to a scenario aligned with climate targets. This could also increase the likelihood of a global temperature rise exceeding 2°C by 40 per cent.

The emerging global energy system is more diverse and complex than ever. By 2030, renewables like wind and solar are expected to generate half of our electricity (up from 28 per cent today), potentially reaching 80 per cent by 2050. However, renewable energy output is variable, influenced by factors like wind speed and sunlight. Additionally, electricity demand is set to surge with the increase of electric vehicles (EVs), widespread installation of heat pumps, and growing use of air conditioners due to rising global temperatures. By 2050, electricity could account for half of all energy used globally, a significant increase from the current 20 per cent.

If we fail to upgrade the grid to meet this growing demand and the need for real-time flexibility to manage renewable energy variability, we'll face significant challenges. Historically, utilities have managed demand spikes by activating fossil fuel plants, but this is no longer a sustainable solution.

By 2030, our power grids will need to be twice as flexible as they are today. By 2050, we'll require four times the installed generation capacity and transfer three times the electrical energy. The future grid will need: 1) increased transmission capacity and interconnections, combined with energy storage for improved flexibility; 2) advanced digitalisation technology focused on sustainability and power electronics; and 3) a global, system-wide approach to energy transition, promoting innovative industry and sector collaboration.

Traditionally, electricity grids have been national or regional, but the future demands more interconnectivity. This is evident in the increasing need for links to transport power over longer distances, from areas of surplus to areas of demand.

In 2023, significant interconnector projects were announced, including Dogger Bank Wind Farm, the world’s largest offshore wind farm, supplying power to the UK mainland via Hitachi Energy’s HVDC technology. Such projects are crucial for future electricity supply reliability. In addition, this technology also allows for new applications where it helps to decarbonise other sectors, such as oil and gas. Project Lightning is a first-of-its-kind subsea power transmission project where HVDC links will connect low-carbon power from the mainland grid to Adnoc production operations as a strategic project to enable a sustainable, flexible and secure power supply.

Given the vast scale and complexity of energy systems and the urgency of climate change, collaboration across companies, academia, and governments is essential. This is especially true in “hard-to-electrify” sectors where transitioning to clean energy is challenging, like aviation, cement manufacturing, and steelmaking. Collaborative efforts combining diverse expertise and technologies are key to overcoming these challenges.

Transitioning from a fossil fuel-dominated energy system to one primarily powered by clean electricity is a monumental task. As the pace of this historic energy transition accelerates, ensuring that our electricity grids are flexible and resilient is crucial to enable a sustainable energy future – for today’s generations and those to come.

GOODBYE%20JULIA

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What is Folia?

Prince Khaled bin Alwaleed bin Talal's new plant-based menu will launch at Four Seasons hotels in Dubai this November. A desire to cater to people looking for clean, healthy meals beyond green salad is what inspired Prince Khaled and American celebrity chef Matthew Kenney to create Folia. The word means "from the leaves" in Latin, and the exclusive menu offers fine plant-based cuisine across Four Seasons properties in Los Angeles, Bahrain and, soon, Dubai.

Kenney specialises in vegan cuisine and is the founder of Plant Food Wine and 20 other restaurants worldwide. "I’ve always appreciated Matthew’s work," says the Saudi royal. "He has a singular culinary talent and his approach to plant-based dining is prescient and unrivalled. I was a fan of his long before we established our professional relationship."

Folia first launched at The Four Seasons Hotel Los Angeles at Beverly Hills in July 2018. It is available at the poolside Cabana Restaurant and for in-room dining across the property, as well as in its private event space. The food is vibrant and colourful, full of fresh dishes such as the hearts of palm ceviche with California fruit, vegetables and edible flowers; green hearb tacos filled with roasted squash and king oyster barbacoa; and a savoury coconut cream pie with macadamia crust.

In March 2019, the Folia menu reached Gulf shores, as it was introduced at the Four Seasons Hotel Bahrain Bay, where it is served at the Bay View Lounge. Next, on Tuesday, November 1 – also known as World Vegan Day – it will come to the UAE, to the Four Seasons Resort Dubai at Jumeirah Beach and the Four Seasons DIFC, both properties Prince Khaled has spent "considerable time at and love".

There are also plans to take Folia to several more locations throughout the Middle East and Europe.

While health-conscious diners will be attracted to the concept, Prince Khaled is careful to stress Folia is "not meant for a specific subset of customers. It is meant for everyone who wants a culinary experience without the negative impact that eating out so often comes with."

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

German intelligence warnings

2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250

Source: Federal Office for the Protection of the Constitution

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