About 1,000 solar power jobs will be created in the UAE during the next two years as employment in the renewables sector rises globally.
A report released yesterday by the Abu Dhabi-based International Renewable Energy Agency (Irena) said that worldwide renewable energy employment grew 18 per cent last year compared with 2013.
This trend is set to continue in the UAE, particularly for the country's solar power sector, with 1,000 jobs expected to be added, according to the Middle East Solar Industry Association (Mesia), an industry group based in the UAE. Its founder and president, Vahid Fotuhi, said that the growth will come from both large projects, such as the Mohammed bin Rashid Al Maktoum Solar Park in Dubai, and the installation of smaller rooftop solar applications.
“Many jobs will be created through the residential and commercial rooftop solar schemes such as Shams Dubai, which will create jobs in manufacturing, engineering, procurement, construction, operations, financing and development,” he said.
Shams Dubai is an initiative from Dubai Electricity and Water Authority (Dewa), which has issued a set of regulations for the generation of solar energy in buildings as well as connection to the grid as part of plans to encourage more solar installations in the emirate.
Larger projects will also offer new employment opportunities.
Paddy Padmanathan, the chief executive of Saudi Arabia’s Acwa, which has been awarded 200 megawatts worth of work in Dewa’s Mohammed bin Rashid photovoltaic (PV) park, said that the full project, excluding construction, could create as many as 300 jobs, both directly and indirectly.
Mr Padmanathan said that the project would also lead to new UAE jobs in the solar energy supply chain.
The Irena report said that solar PV is the largest global renewables employer, ahead of biofuels, wind, small hydropower and geothermal energy, making up almost a third, or 2.5 million, of the 7.7 million global renewable energy jobs.
“If the renewable energy targets that have been announced by GCC countries by 2030 are met, 120,000 jobs annually could be created [in the region],” said Rabia Ferroukhi, the deputy director of knowledge, policy and finance at Irena.
“PV creates twice as many jobs as the oil and gas and coal industry.”
This is because conventional energy production is a mature industry with fewer new developments than in the infant PV market.
Qmega, a UAE-based company that designs and manufactures PV products, will grow its staff by 25 per cent in the next three months, specifically in sales.
“It’s not the manufacturing capacity that’s grown – it’s the value chain,” said the chief executive, Omer Ghani. With the firm’s sales growing, the sales team will also have to grow, he explained.
“Now in Dubai, there are companies – from government to the private sector – calling me because they need to expand their production line and can’t get extra power from [Dewa] to meet their time scale,” he said.
The company also offers solar PV rentals.
“The market is moving from infancy to maturity,” Mr Ghani said.
Ms Ferroukhi said that any industry in the beginning creates a large number of jobs, but that usually changes once the industry matures.
She said that the rate of growth of the renewable energy job market will likely decrease, although it is uncertain by how much and when.
“Right now we’re reaping the benefits of a young industry, and it takes years and years, if not decades, [to reach maturity],” she said.
lgraves@thenational.ae
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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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Company profile
Date started: 2015
Founder: John Tsioris and Ioanna Angelidaki
Based: Dubai
Sector: Online grocery delivery
Staff: 200
Funding: Undisclosed, but investors include the Jabbar Internet Group and Venture Friends
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