Within six years, the sunny Middle East will have as much solar power as the US has today, and more than Germany.
By 2030, it will be approaching China's current level. After a slow start, this oil and gas-dominated region has woken up to the potential of the sun. Major announcements at the World Future Energy Summit in Abu Dhabi last week, and Vahid Fotuhi's article in The National last week, testify to this new awakening.
The Middle East Solar Industry Association identified 12 gigawatts of solar projects in the Mena region that are under construction or awarded. That will be a huge step forward from 2.9 gigawatts operating at the end of last year. The International Renewable Energy Agency's report, released during WFES, foresees that the GCC alone will have 65 gigawatts of solar power by 2030.
Our studies at Qamar Energy show that, making reasonable assumptions on countries’ sometimes ambitious targets, solar capacity in the Middle East, including Egypt, could reach 56 gigawatts by 2025 and 113 gigawatts by 2030, along with 31 gigawatts of wind power.
What are the drivers of this explosive growth?
Firstly, the initial renewable leaders in the region have continued to forge ahead. Morocco, Egypt and Jordan all have an active portfolio of new projects and a growing ecosystem of indigenous renewable developers and engineering contractors.
The UAE’s new Emirates Water and Electricity Company will begin tendering in the first half of this year for 5GW of solar. Dubai Electricity and Water Authority has been accelerating its solar progress, having achieved the world's lowest cost for concentrated solar thermal power, it plans to tender a second plant at the start of this year.
It’s not just large-scale projects. Rooftop solar installations on industrial and commercial buildings have become increasingly popular, as policies allow users to feed surplus electricity back into the grid. Dubai has its Shams scheme and Oman the Sahim programme. At the moment, residential electricity tariffs in the UAE are still too low for this to be attractive to most villa dwellers, but this may change as more companies offer installations, and as they become standard for new construction.
These countries have proved that solar and, in the right locations, wind can achieve highly attractive costs. Competitive tenders and low-cost financing have driven intense innovation between developers. This has made renewables cheaper than the fuel consumption of a gas-fired plant, even with relatively cheap gas, and certainly cheaper than oil. Even if gas turbines have to be retained to meet night-time demand, the overall combination is lower-cost. Renewables reduce carbon dioxide and other pollution, save gas and oil for industry and export, and boost energy security.
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Read more:
Abu Dhabi's green transition gathers momentum during annual sustainability week
Abu Dhabi's Taqa to have 10 per cent renewables in portfolio by 2030
Saudi energy minister: Renewables unlikely to displace global demand for oil
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Secondly, spurred on by the example of the early adopters, the other big power consumers in the region are turning to renewables. Key among them is Saudi Arabia. Its latest ambitious plans today build on the kingdom’s pivot towards embracing new forms of energy with the King Abdullah Centre for Atomic and Renewable Energy.
KA Care’s plan in 2013 was for 54 gigawatts of renewables by 2030; the National Transformation Plan of 2016 replaced that with 9.5 gigawatts by 2023; in March 2018, the kingdom announced a venture with Softbank for 200 gigawatts of solar by 2030; and now the Ministry of Energy’s renewables offices has returned almost to the starting point, intending 59 gigawatts by 2030.
However, the new Saudi push seems much more solidly based. The country has begun work on its first large solar plant, Sakaka, at a record low price. At WFES, it confirmed the award of the Dumat Al Jandal wind project to a joint venture of Masdar and EDF, again at a record-breaking cheap price. It now has a near-term target of 9.5 gigawatts of solar and wind tendered by 2023, which hopefully should keep it on track.
Saudi energy minister Khalid Al Falih maintained at Abu Dhabi Sustainability Week that renewables would be unlikely to displace oil. Yet his country’s plans to boost renewables and gas are intended to “virtually eliminate” oil from power generation, knocking out almost 1 million barrels per day of crude, fuel oil and diesel consumption over the next decade, a not insignificant hit to world demand.
Alongside the Saudi push, other regional countries are waking up to the possibilities. New Iraqi electricity minister Luay Al Khatteeb wants 0.5 gigawatts installed annually. Oman, after a slow start, has invited bids for large solar projects, with its state power procurement company looking for 2.6 gigawatts of renewables by 2024, and Petroleum Development Oman tendering for 0.1 gigawatts, as well as large solar thermal projects to make steam for extracting heavy oil. Even communities in war-torn Yemen are installing local solar panels.
As the solar generation booms, it will bring new challenges, particularly meeting demand during the early evening. Solar thermal projects can store heat in molten salt to generate through the night. Other options include combining batteries, pumped storage in dams as with Dewa’s Hatta project, interconnections of countries in different time zones, and varying customer tariffs to reward them for using electricity at off-peak times.
The laggard countries just have to copy the policies that have already proved successful and be realistic that they will not achieve world record costs immediately. Individual states may go faster, or slower, unsuitable investment conditions may slow progress in places, but overall there is now a robust regional solar industry. Solar momentum is now unstoppable.
Robin M. Mills is CEO of Qamar Energy, and author of The Myth of the Oil Crisis
The bio
Studied up to grade 12 in Vatanappally, a village in India’s southern Thrissur district
Was a middle distance state athletics champion in school
Enjoys driving to Fujairah and Ras Al Khaimah with family
His dream is to continue working as a social worker and help people
Has seven diaries in which he has jotted down notes about his work and money he earned
Keeps the diaries in his car to remember his journey in the Emirates
Sui Dhaaga: Made in India
Director: Sharat Katariya
Starring: Varun Dhawan, Anushka Sharma, Raghubir Yadav
3.5/5
Zayed Sustainability Prize
The bio
Job: Coder, website designer and chief executive, Trinet solutions
School: Year 8 pupil at Elite English School in Abu Hail, Deira
Role Models: Mark Zuckerberg and Elon Musk
Dream City: San Francisco
Hometown: Dubai
City of birth: Thiruvilla, Kerala
Test
Director: S Sashikanth
Cast: Nayanthara, Siddharth, Meera Jasmine, R Madhavan
Star rating: 2/5
MATCH INFO
Karnataka Tuskers 110-5 (10 ovs)
Tharanga 48, Shafiq 34, Rampaul 2-16
Delhi Bulls 91-8 (10 ovs)
Mathews 31, Rimmington 3-28
Karnataka Tuskers win by 19 runs
A German university was a good fit for the family budget
Annual fees for the Technical University of Munich - £600
Shared rental accommodation per month depending on the location ranges between £200-600
The family had budgeted for food, books, travel, living expenses - £20,000 annually
Overall costs in Germany are lower than the family estimated
As proof that the student has the ability to take care of expenses, international students must open a blocked account with about £8,640
Students are permitted to withdraw £720 per month
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.”
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
From Zero
Artist: Linkin Park
Label: Warner Records
Number of tracks: 11
Rating: 4/5
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
The smuggler
Eldarir had arrived at JFK in January 2020 with three suitcases, containing goods he valued at $300, when he was directed to a search area.
Officers found 41 gold artefacts among the bags, including amulets from a funerary set which prepared the deceased for the afterlife.
Also found was a cartouche of a Ptolemaic king on a relief that was originally part of a royal building or temple.
The largest single group of items found in Eldarir’s cases were 400 shabtis, or figurines.
Khouli conviction
Khouli smuggled items into the US by making false declarations to customs about the country of origin and value of the items.
According to Immigration and Customs Enforcement, he provided “false provenances which stated that [two] Egyptian antiquities were part of a collection assembled by Khouli's father in Israel in the 1960s” when in fact “Khouli acquired the Egyptian antiquities from other dealers”.
He was sentenced to one year of probation, six months of home confinement and 200 hours of community service in 2012 after admitting buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures.
For sale
A number of other items said to come from the collection of Ezeldeen Taha Eldarir are currently or recently for sale.
Their provenance is described in near identical terms as the British Museum shabti: bought from Salahaddin Sirmali, "authenticated and appraised" by Hossen Rashed, then imported to the US in 1948.
- An Egyptian Mummy mask dating from 700BC-30BC, is on offer for £11,807 ($15,275) online by a seller in Mexico
- A coffin lid dating back to 664BC-332BC was offered for sale by a Colorado-based art dealer, with a starting price of $65,000
- A shabti that was on sale through a Chicago-based coin dealer, dating from 1567BC-1085BC, is up for $1,950
At Everton Appearances: 77; Goals: 17
At Manchester United Appearances: 559; Goals: 253
The specs
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
MEDIEVIL%20(1998)
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