The Makings Of A Solar Superpower?

Saudi Arabia has the potential to be the exception to the rule here as it aims to commission 54GW of renewable energy by 2032. 500-800MW of capacity is due to be awarded as part of the introductory round by the end of 2013, with capacity allocations increasing in subsequent rounds, involving up to 7GW of capacity in a two-to-three year timeframe. The program is in the early stages however and has suffered considerable delays to date.

Overall, Saudi is seeking about $100 billion in investments to generate about 41,000 megawatts, or a third of its power, from solar by 2032. That compares with about three megawatts now, which puts it behind Egypt, Morocco, Tunisia, Algeria and the UAE in capacity, according to Bloomberg New Energy Finance figures.

The market entry options for companies is different from country to country, but in the case of Masdar’s Shams 1 project, 20 per cent is owned by Total and 20 per cent is owned by Abengoa, both European energy producers. The remainder of the project is owned by Masdar itself.

In March, at the inauguration of the new $750 million concentrated-solar plant, the head of Abengoa’s solar unit Santiago Seage said the execution of solar programs in the Middle East would bring “thousands of megawatts and billions of dollars in investment,” and that the unit plans to bid on more projects in the region.

Adding clean-power generators like this may help oil producing nations in the Gulf to conserve more crude and gas for export, reducing their use of the fuels to generate power that’s sold at subsidised prices.

Also, it’s worth noting that overall, electricity production is the most energy intensive industry in the Middle East and is produced mostly from fossil fuels. The climatic conditions of the region make air conditioning a must resulting in more than average power consumption as compared to the rest of the world.

About 99 per cent of water comes from desalination, another energy consuming process, working mainly on gas feeds. Water and electricity together are the most energy consuming sectors in the region and some of these countries are the highest per capita consumers of power and water.

Masdar chief executive Sultan Ahmed Al Jaber called Shams 1 “a major breakthrough for renewable energy in the Middle East,” noting that the company now generates nearly 10 per cent of the world’s solar thermal electricity. Shams 1 will power about 20,000 homes in Abu Dhabi.

The new plant will produce 100 megawatts of power by harnessing the sun to heat liquids and create steam to turn turbines. That differentiates the facility, called Shams 1, from a photovoltaic plant, which uses panels to convert sunlight directly into electricity.

In a report from Bloomberg news, Philippe Boisseau, president of new energies at Total, said he will study concentrated-solar power, or CSP, and photovoltaic projects in Saudi and Qatar.

While PV is “probably the most economical technology for solar generation,” CSP allows energy to be stored because operators can stockpile heated liquids for use when the sun isn’t shining, said Boisseau.

The new Abu Dhabi plant uses so-called solar troughs, which contain 20-foot mirrors, to reflect the sun’s heat onto tubes holding oil. The tubes could span the 120-kilometre (75-mile) distance to central Abu Dhabi. The facility, which doesn’t yet have storage facilities, can still run 24 hours a day using natural gas to drive turbines when there’s no sun.

The fact that Paris-based Total and others are planning to increase investments in Middle Eastern renewable energy underpins the region’s potential as a global leader.