Capital plugs into renewable energy



ABU DHABI // The Abu Dhabi Government connected the emirate's first major solar power plant into the electricity grid yesterday, marking the first tangible result of the country's multibillion-dollar foray into renewable energy. Officials connected a 10-megawatt solar panel array at Masdar City, the carbon-neutral development at the edge of the capital, to the grid in a ceremony attended by Sheikh Diab bin Zayed, the chairman of the Abu Dhabi Water and Electricity Authority (Adwea).

The connection represented "an important milestone in the development of Masdar City and in our emirate's history" and would pave the way for a number of larger renewable energy projects to be connected to the grid as the city is constructed, said Sultan al Jaber, the chief executive of Masdar, the government's renewable energy firm. "The greatest challenge came in the amount of power we are generating and sending to the grid," he said.

"Ten megawatts is a significant amount of power, and a plant this size has not been grid-connected in the Middle East before," he said. The amount of electricity generated by the Dh185 million (US$50.3m) solar panels would displace 15,000 tonnes of carbon dioxide a year that would have been emitted from fossil fuels in a conventional power station, according to Masdar officials. The sum of carbon is equivalent to taking 3,300 cars off the emirate's roads.

The agreements with ADWEA, the Abu Dhabi Distribution Company (ADDC) and the Regulation and Supervision Bureau (RSB) would "streamline future projects", said Dr al Jaber. Abu Dhabi has set a goal of generating 7 per cent of electricity from renewables by 2020, and Masdar has plans to construct several large-scale solar thermal plants in Madinat Zayed that will each generate more than 100Mw from the sun.

One megawatt is enough electricity to power between 500 and 1,000 homes, depending on a host of factors including the need for air conditioning and electricity-use patterns. The solar panels connected yesterday at Masdar, composed equally of two categories of photovoltaics called thin film and crystalline silicon, will generate about 17,5000Mw-hours of electricity directly from sunlight every year. The output will mostly be used to power the construction of the city and its first building: the Masdar Institute of Science and Technology, which opens in the autumn. More panels will be installed on the roofs of buildings, Dr al Jaber said.

Masdar said the high output of the panels meant the plant "is also one of the most cost-efficient PV [photovoltaic] installations in the world", but did not detail how much each Mw-hour would cost to generate. Masdar officials said they had not yet reached agreement with ADWEA on a price to charge for the electricity.
cstanton@thenational.ae

THE BIO

Family: I have three siblings, one older brother (age 25) and two younger sisters, 20 and 13 

Favourite book: Asking for my favourite book has to be one of the hardest questions. However a current favourite would be Sidewalk by Mitchell Duneier

Favourite place to travel to: Any walkable city. I also love nature and wildlife 

What do you love eating or cooking: I’m constantly in the kitchen. Ever since I changed the way I eat I enjoy choosing and creating what goes into my body. However, nothing can top home cooked food from my parents. 

Favorite place to go in the UAE: A quiet beach.

MATCH INFO

Chelsea 1
Alonso (62')

Huddersfield Town 1
Depoitre (50')

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.”

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MATCH INFO

Uefa Champions League semi-final, first leg
Bayern Munich v Real Madrid

When: April 25, 10.45pm kick-off (UAE)
Where: Allianz Arena, Munich
Live: BeIN Sports HD
Second leg: May 1, Santiago Bernabeu, Madrid

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What are the regulations?
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Company Profile:

Name: The Protein Bakeshop

Date of start: 2013

Founders: Rashi Chowdhary and Saad Umerani

Based: Dubai

Size, number of employees: 12

Funding/investors:  $400,000 (2018) 

Indian construction workers stranded in Ajman with unpaid dues