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2019 a watershed year for Renewable Energy in the UAE

The commissioning of the world’s largest single-site photovoltaic (PV) solar plant – the 1.17 GW Sweihan independent power project (IPP) in Abu Dhabi, and Dubai arriving at a financial deal for a USD 4.3 billion concentrated solar power (CSP) project, the largest single-site power investment project in the world, represent significant milestones, Informa, the organiser of Middle East Energy, says

  • By Content Team |
  • Published: December 17, 2019
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DUBAI, UAE 17 December: The Middle East’s energy and utilities sector is undergoing an unprecedented transformation, with the shift towards renewable energy and digital innovation at the heart of ambitious energy diversification programmes, Informa Markets, organiser of Middle East Energy (the new name of Middle East Electricity), said, adding that as governments seek to increase energy security and maximise returns from hydrocarbon resources, utilities are pressing ahead with some of the largest renewable energy schemes in the world. Held under the patronage of H.H. Sheikh Maktoum Bin Mohammed Bin Rashid Al Maktoum, Deputy Ruler of Dubai, and hosted by the UAE Ministry of Energy & Industry, Middle East Energy will run from March 3 to 5, 2020 at the Dubai World Trade Centre.

According to the release, a number of milestones in the push for clean energy across the region were reached in 2019, including the commissioning of the world’s largest single-site photovoltaic (PV) solar plant – the 1.17 GW Sweihan independent power project (IPP) in Abu Dhabi. Shortly after the commissioning of the Sweihan plant in March, neighbouring emirate, Dubai reached a financial closure for a USD 4.3 billion concentrated solar power (CSP) project, the largest single-site power investment project in the world, Informa said.

The drive to integrate alternative energy resources into utilities networks is set to accelerate in 2020, as governments seek to meet the rising demand for power, Informa said. Rapid population growth, combined with ambitious industrial and economic expansion programmes, is resulting in  growing need for power, with demand for electricity in the Middle East forecasted to triple by 2050, Informa said, and quoted Energy & Utilities as estimating that installed power generation capacity will be required to increase 35% by 2025 just to meet rising demand.

Reducing costs and emissions

With the production of electricity across the region having been predominantly fuelled by oil and gas since the 1970s, utilities are seeking to diversify fuel sources for power generation, with renewables at the core of diversification plans, Informa said.

While the global targets agreed for reducing carbon emissions at COP 21 in Paris in December 2015 grabbed global headlines, the push for renewables is being facilitated by economics, Informa said. The drive for clean energy is being driven by the sharp drop in the cost of solar and wind power technologies, with the cost of installing PV solar and wind having fallen by 73% and 80%, respectively since 2010, Informa added.

Much of the fall in the cost of delivering utility-scale renewables plants is being driven by Middle East and North African utilities, with the UAE, Saudi Arabia and Egypt all having set records for solar and wind power tariffs since 2015, Informa said.

Growing opportunities

According to data from the International Renewable Energy Agency (Irena), 167 GW of renewable energy capacity was installed globally in 2017, accounting for 61% of additional power capacity installed, Informa said. This was more than double the capacity of new fossil fuel plants, which amounted to 27%, Informa added.

While the percentage of clean energy installed in the Middle East has, to date, been more modest, with installed solar and wind accounting for 2,350 MW and 434 MW, respectively of the region’s energy in 2017, regional utilities are pressing ahead with some of the largest clean energy programmes in the world, Informa said.

Informa quoted Energy & Utilities as estimating that USD 100 billion worth of clean energy projects are currently in the project pipeline, with total investment in clean energy to exceed USD 300 billion by 2050, if the region’s utilities are to meet their ambitious targets.

Saudi Arabia’s target to install 58.7 GW of renewable energy by 2030 will offer some of the most exciting opportunities for regional and international investors and energy firms, Informa said. The Kingdom’s Renewable Project Development Office (REPDO) is planning to launch tenders for the 1.6 GW third round of its National Renewable Energy Programme (NREP) by the end of 2019, Informa said, as of the time of posting this article, on December 16.

The UAE will remain a focal point of the clean energy transition, having set a target of 50% of its energy to be produced by carbon-free sources by 2050, Informa said. Following the submission of bids in November for the planned 2 GW Dhafra solar IPP in Abu Dhabi, the emirate is already working on plans for its next major solar project, PV 3, which is planned to yield 1.5 GW – 2 GW, Informa said.

In Dubai, a consortium led by Saudi Arabia’s Acwa Power submitted a world-record-low tariff of 1.695 US cents a kilowatt hour ($c/kWh) for the fifth phase of the Mohammed bin Rashid (MBR) solar development in October, Informa said. With Dubai having set an even more ambitious target of 75% clean energy by 2050, the emirate will remain a key driver of renewables deployment across the region, Informa said.

The push to integrate renewables into the region’s energy sector will form a key part of Middle East Energy, Informa said, adding that clean energy will have its own dedicated track at the event.

Gareth Rapley, Group Director, Industrial, Informa Markets, said renewable energy is no longer just a concept but set to take centrestage at the event. “Driven by well-designed auctions, favourable financing conditions and declining technology costs, renewables are being brought into the mainstream,” Rapley said. “Based on the renewables targets already in place, the region, led by the UAE, could save 354 million barrels of oil, which is equivalent to a 23% reduction, cut the power sector’s carbon dioxide emissions by 22% and slash water withdrawal in the power sector by 17% by 2030.”

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