Arab states may become solar energy exporters

www.business24-7.ae
February 07, 2010

Massive renewable energy projects undertaken by the UAE and other Middle Eastern countries could turn them into solar energy exporters along with their large hydrocarbon exports, according to a veteran Arab energy analyst. "After oil, Arab countries could start exporting solar energy," said Nicolas Sarkis, Director of the Paris-based Arab Petroleum Research Centre (APRC), which acts as an adviser to the 10-nation Organisation of Arab Petroleum Exporting Countries. "The development of solar energy is rapidly becoming a priority of energy policies pursued by most countries in the Middle East and North Africa, whether oil and natural gas producers or not," Sarkis wrote in the APRC's monthly magazine, Arab Petroleum and Gas.

He said that in non-oil Arab countries, the growing interest being shown in solar energy and other renewable energy sources is dictated not only by the deterioration in their energy deficits and the insufficiency of their indigenous fossil fuel resources but also by environmental imperatives and the technological progress that characterises the development of renewable energies. As for the large hydrocarbon exporting countries in the Arab World, the exploitation of their huge potential in the area of solar energy reflects a dual concern to protect the environment and prepare the post-oil era, he said.

UAE
Highlighting solar projects and other renewable energy developments in the region, Sarkis said the UAE has emerged as a pioneer in this sector. "Abu Dhabi has emerged as a pioneer with its famous Masdar initiative, the largest clean energy development programme going ahead anywhere in the world, with investments of more than $22 billion (Dh80.7bn)," he said. He noted that several agreements have been concluded for the construction of Masdar City, including with BASF and Fraunhofer Gesellschaft of Germany.

Masdar, which is an offshoot of Abu Dhabi Future Energy Company, part of the state-owned Mubadala group, has launched numerous projects both in the UAE and at the regional and international level. Its first photovoltaic solar energy plant, which has a capacity of 10 MW and is the largest built so far in the Middle East, was connected to the UAE's national power grid last May.

Since 2008, Masdar has also concluded several agreements with international companies for the implementation of a wide range of renewable energy ventures, including one with German company Coenergy for a plant to produce solar panels as part of a $2bn programme, and an association agreement worth $1.2bn with the Spanish company Sener for the development of a photovoltaic power station, according to Sarkis.

Over the past few months, Masdar has also launched a number of other schemes. In particular, it has signed an agreement with Bahrain's National Oil and Gas Authority (Noga) for reducing greenhouse gas emissions in that country, concluded an agreement worth €2.2bn (Dh11bn) with E.ON and DONG Energy for the implementation of the first phase of a windfarm in the Thames estuary east of London, in the United Kingdom, and embarked on the study of a wind energy project on the island of Mahé in the Seychelles.

Saudi Arabia
"Another very significant example is Saudi Arabia. The fact that it is the world's leading oil-exporting country has not prevented it from deciding to invest in the development of solar energy," Sarkis said.

Under the terms of an agreement signed last June, Saudi Aramco and the Japanese refining company Showa Shell are to develop a pilot solar energy plant that will have a capacity of 10 MW and is due to come on stream in 2011. Another 20 MW solar energy plant is due to be built at King Abdullah University of Science and Technology, along with a center devoted to photovoltaic technology.

For its part, Algeria announced in September 2009 that it was to develop a 150 MW solar energy station at Hassi R'Mel. Other Arab states Other oil-exporting countries, such as Kuwait and Iraq, recently announced their determination to go down the same road. Egypt is also planning to develop power stations running on renewable energies that will account for 20 per cent of its total power generation capacity by 2020.

"With limited hydrocarbon resources and rapidly growing domestic energy demand, all other Middle Eastern and North African countries are turning to renewable energies, especially solar energy," Sarkis said. "The most ambitious is Morocco, which in November 2009 announced a $9bn programme for installing renewable energy power plants with a total capacity of 2 GW by 2020, representing 14 per cent of the country's total power generation capacity at that point."

Tunisia, too, has drawn up a national programme, the Tunisian Solar Plan, which encompasses some 40 projects to be implemented over the 2010-2016 period under public-private partnership arrangements. Twenty-nine of the projects are due to be carried out by private sector companies and the rest by the public sector, including five by the Société Tunisienne d'Electricité et du Gaz (Steg), which is to establish an ad hoc subsidiary called Steg Energies Renouvelables. "The Tunisian Solar Plan calls for total investments of $2bn over the 2010-2016 period and is designed to enable Tunisia to reduce its consumption of conventional energy sources by some 660,000 tonnes of oil equivalent per year, equivalent to 22 per cent of the country's total energy consumption by 2016."

Mediterranean
In addition, the Mediterranean Solar Plan (MSP) launched in 2008 by the Union for the Mediterranean has given a major impetus to solar energy projects throughout the Middle East and North Africa region, according to Sarkis. "The objective of the MSP is to have a total solar energy generation capacity of 20 GW installed by 2020, with part of the electricity produced destined for domestic consumption and part for export to Europe by means of subsea cables… the total capital investment required is estimated at €38-46bn during 2009-2020."

Sarkis referred to the recent announcement by the World Bank that it would provide financial support to five Mena countries for 11 projects involving the construction of concentrating solar energy (CSP) stations, which are expected to cost some $5.5bn altogether. "Other financial institutions are expected to fund investments totalling an estimated $4.85bn in the region. The 11 projects concerned are to be undertaken in Algeria, Egypt, Jordan, Morocco and Tunisia and will entail the installation of total generating capacity of 900 MW by 2020. More than 200 projects have been developed and submitted for approval under the MSP."

Sarkis said the APRC would organise a conference and exhibition in Paris in September 2010 to examine the progress made until date and the prospects for the MSP. SlarMed will bring together leading players from the public and private sectors involved in the implementation of the MSP. In a recent study, a veteran Arab expert urged Gulf oil producers to introduce incentives to encourage the establishment of solar and wind energy projects to ensure their power needs and save their hydrocarbon wealth. Waheeb Al Nasir, Director of the Arab Section at the Germany-based International Solar Energy Society (ISES), said he expected the amount of new solar and wind electricity in the GCC to reach 5,000 MW by 2015, including 1,000 MW in Bahrain, 3,500 MW in Qatar and 400 MW in the UAE.

But he noted such capacity remains tiny compared to what he described as the massive solar and wind potential in the six-nation GCC. Al Nasir cited figures by the World Energy Council showing the GCC nations would require around 100 GW of additional power production over the next 10 years to meet their demand at a cost of nearly $25bn, most of which is expected to be invested by the private sector.

He said solar and wind projects in the GCC, which controls more than 45 per cent of the world's extractable crude deposits and a quarter of the global gas wealth, would allow member states to save their hydrocarbon wealth, expand their petrochemical industry, produce hydrogen for export and create jobs. "Solar and wind energy will also contribute to the reduction of the high ratio of CO2 per capita in the GCC. Using renewable energy will lead to prolonging the life of oil and natural gas in these countries and use this resource for petrochemicals industry or use it to produce hydrogen for local use and export," said Al Nasir, also Economics Professor at the Bahrain University.

"Given the high cost of solar and wind energy, there should be an incentive system that provides a sufficient rate of return on such costly investment to encourage investors, ie, introducing Feed In Tariff and making the national grid capable to be integrated with solar and wind electricity."

Key solar and wind projects in GCC

UAE

• Etisalat: In 1997, as a major project of etisalat, the UAE started the installation of passive cooled shelters and solar photovoltaic power systems for powering 33 remotely located island and desert-based GSM base stations. The project, valued at $10m, involved design, manufacturing, installation, testing, and commissioning.
• Dubai Civil Aviation orders solar airport: Green Energy, Dubai, has received an order from Dubai Civil Aviation to supply solar energyed LED airfield lights to be installed at Dubai International Airport. The order consists of solar energyed LED model A601 red lights. After testing A601 lights, authorities concluded solar energyed LED lights were ideal.
• Solar LED flashing beacon in The Gardens, Dubai: Green Energy LLC has been contracted by "The Gardens" a project by Nakheel, to supply solar energyed LED R247C flashing beacons for installation at their property.

Saudi Arabia
Joint programme with the US: This programme, which is called Soleras Solar Energy Research American/Saudi addressed solar energy technological and economical related issues. Soleras began in 1977 and concluded in 1987. A second programme started in 1989 with the US Department of Energy.

• Soleras: In the Soleras programme, each country contributed $50m to the budget. This solar research funding exceeded all expenditures by Saudi Arabia on any solar research activity and the total international solar research commitment of the United States.

Kuwait
A systematic analysis was conducted to assess the technical benefit and economics of solar-based technologies to produce electricity, water and heating or cooling. Solar cooling was found to save up to 50 per cent of electricity compared to the conventional system and much more, if the auxiliary power is supplied from PV source. Solar PV power supply can save 100 per cent electricity for off-grid applications.

Bahrain

• Bahrain World Trade Centre: The first wind mill installed in Bahrain was in the 1950s but the latest one was in 2007 and was integrated to a building, Bahrain World Trade Centre. It consists of three parallel wind turbines, each having a blade diameter of nearly 30m. The total power output of these three turbines is 0.66 MW. They cost only 3.3 per cent BD1m (Dh9.74m) of the whole construction cost.
• Alba solar water heater: The solar water heating system at Alba Healthcare centre.

Oman
The Total Renewable Energy Installation in Oman is 235 kW. Among these projects are:

• The Oman Solar System has designed, manufactured and installed solar lighting systems.
• solar energy supply systems for unmanned microwave telecommunications systems to Omantel.
• Pay phone booths.
• TV transposer systems MOI.

Qatar
Qatar had much interest in renewable energy. There were three published papers on wind and solar potential in Qatar. Also, there was a relatively large scale Solar Pond Project with, probably, not less than 10 kW power.