DUBAI // Dubai Municipality will continue to invest in solar power and energy-efficient systems after saving hundreds of thousands of dirhams a year in energy costs.
Solar street lights, hot-water systems and simple changes in using air conditioning at the municipality's buildings have helped it to slash power bills, said Juma Al Fuqaei, director of the general maintenance department.
Among the more efficient technologies is the 20,000-litre solar-powered hot-water system being used at the Dubai Abattoir in Al Qusais for nearly a year.
"We used to rely on diesel to heat up the water. Right now we are using solar power," said Mr Al Fuqaei.
He said the system was expected to bring savings of Dh300,000 this year, and the municipality expected to recover its investment in two and a half years.
A 500-litre solar hot-water system at Al Quoz cemetery has also been performing well, Mr Al Fuqaei said.
The municipality has installed a similar system in the Al Fahidi Market, which is to open soon, and is considering it for its labour accommodation, which houses about 8,000 people.
Although expensive, photovoltaic (PV) solar panels were recently installed on the roof of a public toilet near Al Mamzar Park, with another 10 due to be fitted this year.
As the toilets' power needs are small the effects of the energy saved are limited, but Mr Al Fuqaei said it would help to make the technology more visible for citizens.
"Our return on investment might take eight years but this project has other indirect benefits," he said.
Solar power has also been used for street lighting at parks, beaches and open-air markets over the past five years.
One thousand street lights in Al Mamzar and Al Mushrif parks are being fitted to run off solar panels. The project, which cost Dh2.2 million, should be finished in a month.
The maintenance department is also involved in a Dh6 million project to upgrade the air-conditioning chiller units to more efficient models in municipality buildings that are more than 20 years old.
Air-conditioning uses up to 70 per cent of a building's energy needs, especially in summer.
The municipality has also linked up with the sustainable technology company Pacific Controls to remotely monitor electrical equipment in its Al Twar service centre.
By being able to adjust how the equipment operates, depending on temperature, occupancy and time of the day, the project has cut energy use by 28 per cent, or Dh100,000 a year.
The system is being extended to Naif Souq, the service centre in Al Manara and the Dubai Central Laboratory.
These efforts fall under a 2011 mandate to reduce the municipality's total energy and water bill by 20 per cent. A reduction of 15 per cent was achieved last year, said Mr Al Fuqaei.
While the goal is to save energy and reduce the carbon footprint, the initiative also makes financial sense, he said.
"We study all projects carefully and we do not implement a project unless it is saving money and has a good return on investment," Mr Al Fuqaei said.
vtodorova@thenational.ae
What is the FNC?
The Federal National Council is one of five federal authorities established by the UAE constitution. It held its first session on December 2, 1972, a year to the day after Federation.
It has 40 members, eight of whom are women. The members represent the UAE population through each of the emirates. Abu Dhabi and Dubai have eight members each, Sharjah and Ras al Khaimah six, and Ajman, Fujairah and Umm Al Quwain have four.
They bring Emirati issues to the council for debate and put those concerns to ministers summoned for questioning.
The FNC’s main functions include passing, amending or rejecting federal draft laws, discussing international treaties and agreements, and offering recommendations on general subjects raised during sessions.
Federal draft laws must first pass through the FNC for recommendations when members can amend the laws to suit the needs of citizens. The draft laws are then forwarded to the Cabinet for consideration and approval.
Since 2006, half of the members have been elected by UAE citizens to serve four-year terms and the other half are appointed by the Ruler’s Courts of the seven emirates.
In the 2015 elections, 78 of the 252 candidates were women. Women also represented 48 per cent of all voters and 67 per cent of the voters were under the age of 40.
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.”
States of Passion by Nihad Sirees,
Pushkin Press