solar energy in middle east

What is solar energy?Solar energyis radiantlightandheatfrom thesunharnessed using a range of ever-evolving technologies such assolar heating,photovoltaics,solar thermal energy,solar architectureandartificial photosynthesis.

The Middle East can achieve first-move advantage in a market that appears to be the longer-term future of energy.

The rise of shale has posed a rare challenge to Middle Eastern oil, culminating in a global oil price war and moving OPEC members to slash profits to retain market share. But at a time when OPEC's hegemony over the oil markets has been challenged, let us not forget there is another abundant natural energy resource the Middle East possesses - the sun.The abundance of sunlight (and therefore solar power) offers Middle Eastern energy producers an opportunity to achieve first-move advantage in a market that appears to be the longer-term future of energy. In light of recent instability in oil markets, the importance of alternative renewable energies, particularly solar, has become all the more pronounced. The drop in oil prices has precipitated an efficiency rush in energy production in all producer nations. In the US, oil producers are leaving no stone unturned in the hunt to become as efficient and sustainable as possible.In Europe, there is a renewed push for renewable energy and some countries like the UK are also pursuing nuclear energy as a longer-term solution. In the Gulf, there are similar measures taking place to become more efficient in a more competitive energy market, and increasingly, they are turning to solar to achieve it.Domestic budgets

The Gulf states remains one of the biggest oil producers in the world, and make up the biggest exporting members of OPEC, especially Saudi Arabia. While some of these countries can afford to swallow current oil prices for now, they will nonetheless find it difficult to maintain their domestic budgets - all OPEC countries chose to cut prices in order to hold onto market share, this means slashing profit. It would not be unprecedented for these countries to encounter domestic trouble.

Solar power lights up Nigerian village

The other, more serious concerns for these major oil producers, is the increasing consumer demand in their own countries. In past decades, the region has been able to sustain luxury alongside completely inefficient energy policies through government subsidies. But the entire energy outlook for the region is changing rapidly.Rising populations, a growing middle class, industry diversification and increasing consumerism has turned a number of countries in the Gulf region into major energy consumers. In Saudi Arabia, oil accounts for over 65 percent of all electricity production, in Kuwait it is 71 percent, in Lebanon it is 94 percent and in Yemen it's an astonishing 100 percent. This represents an energy policy that is inefficient and in the long run - unsustainable.Saudi Arabia is the biggest petroleum consumer in the region, it is the world's second biggest consumer of total primary energy, 60 percent of which is petroleum-based. But most importantly, it paints a distressing future for the regions oil export industry. If consumer demand continues to grow, it will eventually result in downward pressure on oil exports and could start affecting subsidies. Without a robust and efficient energy balance in the region, it will inevitably lead to these producer nations becoming less profitable with a weaker export outlook.Long-term dynamicAnd with competitors in the oil market like Russia, Iran and the North American shale, this is a long-term dynamic that will undermine Middle East's global energy dominance.However, the possibilities associated with harnessing Middle Eastern solar energy could be a game-changer. Solar is becoming much cheaper to invest in, and now has an established and ever improving infrastructure. Substantial investment in solar will act as a shield for the region's more valued commodity; oil. Saudi Arabia alone for example, could have made $43.8bn in additional oil revenue in 2013 were it not for its spiralling domestic consumption.It also would have acted as a massive stimulus to the country's finances. Earlier this year, Saudi Aramco, the state oil company, announced it would be making solar energy investments across the country in an attempt to diversify the country's energy supplies. It is also expected to conserve the country's oil resources primarily for export.It has been a slow process but is nonetheless an important one for the future of the solar energy sector. One of the biggest success variables for any solar energy project is not just investment, but location. The Middle East's solar industry is one of the most economically sustainable and acts as the best conserver of the region's oil resources.Investment opportunity

It is also a very strong investment opportunity for those looking to invest in a sustainable, long-term energy sector with a ready market and significantly lower start-up costs then depleting energy exploration.But these new developments would also have another important advantage for the Middle East; a cleaner environment. The use of petroleum for electricity generation has made the Middle East's air quality one of the poorest in the world. Twenty-nine of the world's most polluted cities are in the MENA region.Recent energy challenges could have very costly consequences for the region if left unaddressed, but they could also reap huge rewards if met with robust energy reforms and additional investment in alternative energies, especially solar. And there are positive signs for the region. Saudi Arabia alone has announced a $109bn investment plan to generate a third of its electricity. Qatar has also made solar energy agreements with major renewable energy companies as part of its commitments to the Solar GCC alliance.How these measures materialise over the next decade or so remains to be seen, but there is room for optimism. What's more, the Middle East's unrivalled solar potential means that theoretically, it can become more then a just a world leader in fossil fuel production, it can become a world leader in renewable energy production as well.

The possibilities associated with harnessing Middle Eastern solar energy could be a game-changer. Solar is becoming much cheaper to invest in, and now has an established and ever improving infrastructure.

The Middle East Turns To SolarEnergyAs nations worldwide continue the search for alternate energy options, traditionally oil-rich Gulf States are looking up to their other abundant resource: The sun. Last year, Saudi Arabiaannouncedit was raising funds to spend $109 billion on solar energy, in a push to secure a third of its electricity from renewable resources by 2032. In March, Abu Dhabibegan operating the worlds largest solar power plant, Shams 1.Now, solar expenditures are expected to increase 40% year after year through 2017 in the Middle East, South America and Africa.Shams Arabic for sun is run by renewable energy corporation Masdar. It now generates nearly 10% of the worlds solar thermal electricity, powering 20,000 homes in the U.A.E... Middle Eastern startups are also getting in on the solar boom, attempting to solve the regions problems on a smaller scale. Karmsolar aims to combat the regions water shortage with solar desalination systems and water pumps, while Solarist hopes to provide cheap, portable desalination machines.Unsurprisingly, a study by S&P pegged interest in solar power to rising oil costs. According to S&Ps findings, from 2004-2008, the annual value of solar activity rose each year, with deal activity reaching $3.1 billion in 2008 (oil prices peaked in July 2008.)For oil-rich Gulf States, the move toward solar energy is a smart one. The more solar energy they use to power their nations, the more petroleum they can export to oil-thirsty countries.

Solar power to shine through in the Middle East in 2015

Last year was a breakthrough 12 months for solar power in the Middle East.To put 2014 in perspective, in the previous 7 years only 70 megawatts (MW) of solar photovoltaic system (PV) projects were awarded across the region. In 2014 alone, that figure stood at 287MW a fourfold increase according to a new report published by the Middle East Solar Industry Association.There are two factors fuelling this sharp rise in solar projects in the region.First, the price of solar systems has dropped dramatically since 2009 when the first large-scale solar project in the Middle East was unveiled by Masdar in Abu Dhabi. The installation cost of utility-scale solar PV power plants have fallen from about $7.00 perwatt in 2008 to less than $1.50 per watt last year. This amounts to more than a 75 per cent cost reduction. It means that for the same budget used to run a 10MW solar PV power plant in 2008, a plant five times larger can be built today without having to spend a fil more.As a result of this cost reduction, solar energy is now competitive with the wholesale price of electricity in many jurisdictions in the Middle East. One example is the recent Dubai Electricity & Water Authority (Dewa) tender for a 100MW solar PV power plant. Dewa was able to secure a 25-year electricity tariff of approximately $0.06 per kilowatt hour (kWh). This tariff is broadly in line with the price of generating power from natural gas, the staple fuel for much of the regions power generation infrastructure.At the same time as solar prices are falling, the cost of generating electricity from natural gas is going up.Here in the UAE, the government has historically been able to produce or import natural gas for less than $2.00 per million British thermal units (MMBtu) resulting in natural gas-based electricity generation at very low cost.Today, however, much of the new domestic natural gas production could cost up to $8.00 per MMBtu to deliver to the market due to high concentrations of hydrogen sulphide (H2S) or carbon dioxide (CO2), which are toxic and corrosive. LNG imports, which were introduced in 2010 in Dubai and may begin on a larger scale in Abu Dhabi as early as 2016, cost more than $12.00 per MMBtu.Meanwhile, in Jordan, the natural gas pipeline that provided the country with 95 per cent of the fuel needed to generate its electricity was repeatedly blown up during the Arab Spring. This pushed up the average cost of electricity to $0.24 per kWh.When solar developers approached the government and offered solar PV energy at a price that was 30 per cent cheaper, its no surprise that Jordan jumped at the opportunity and awarded long-term utility-scale power projects to 12 international consortiums dotted across the countries. Together they will generate 300 GWH of clean electricity, enough to power nearly 1 million households.Even with the recent drop in oil prices, solar power will continue to grow. For one, oil accounts for only 5 per cent of global electricity production, according to the International Energy Agency. In the Middle East, the majority of the electricity generated comes from natural gas. And as we have seen from the Dewa example, solar power is already in line with the cost of electricity from natural gas.Moreover, solar and oil operate based on opposite drivers. With fossil fuels such as oil and natural gas, as demand goes up, so do prices. With solar, as consumption goes up, prices come down thanks to economies of scale. And so, as demand for solar continues to balloon in our region, we will see prices continue to deflate, thus creating a whirlwind cycle which will progressively expand the footprint of solar across the region regardless of the fluctuations in oil prices.Looking ahead to 2015, we will see three trends emerging.First, we will see projects become much bigger in size. The typical project will go from 1 to 10MW to 10 to 100MW. According to research compiled by Mesia, in 2013 there were only 4 projects awarded that were larger than 10MW. In 2015, we expect that number to reach 40, a tenfold increase.A good example of the regional move toward solar can be found in Egypt. As its natural gas infrastructure continues to age, it is becoming more expensive for Egypt to generate power using the fuel. Egypt has therefore turned its attention to how it can take advantage of its abundant potential for solar and wind energy.Just last month Egypts ministry of electricity unveiled a landmark programme which will see it introduce about 2,000MW of large-scale solar PV power plants and 300MW of rooftop solar power projects. The fact that about 176 companies responded to the ministrys invitation to submit proposals for this Feed-in-Tariff (Fit) programme is a clear signal that solar has become a bankable source of energy in all corners of the Arab world.At the same time, the market is becoming more broad-based. In the past, most of the solar projects were focused on the UAE. This year there will be large-scale solar tenders in at least 10 different markets in the Middle East, a new record, with Egypt leading the way followed by Jordan and then Morocco. Even small Arabian Gulf countries such as Qatar are making progress with solar.This diversity will become more exciting once Saudi Arabia enters the market. It has so far been held back from achieving its Herculean solar potential due to the lack of political alignment. But in time they too will turn to solar in a big way, following the footsteps of Jordan and Egypt.This will no doubt herald a new wave of dramatic growth in our regions emerging solar market. In fact, Saudi Arabias most recent plans for solar PV entail building a capacity of 6GW over the next 10 years. 2015 is expected to be the year that Saudi finally starting moving ahead with its ambitious plans.Finally, we will see niche segments within the solar industry emerging. In the past, the typical profile of the companies was small local installers. But as the market continues to grow we will see more specialised companies. Aside from the traditional installers we will see system operators such as SAT Engineering and solar-diesel hybrid system providers such as Enerwhere rise to the forefront.Dubais landmark unveiling of a grid-connected solar rooftop programme will also foster the growth of specialised rooftop installers. As a result, solar companies that had to endure razor-thin margins to win projects in the past now have the luxury to pick and choose which projects they can chase.As a specific example, Chinese solar panel manufacturer Chang Zhou Almaden is reportedly setting up a factory in Dubai to produce up to 400,000 PV panels annually.This year will therefore be a breakthrough year for solar energy in the Middle East. The UAE will do its share leading the industry, with large-scale solar projects awarded in both Abu Dhabi and Dubai. But in 2015 we will also see such mega projects mushrooming across the entire Middle East, ushering in a new era for our regions most abundant source of energy solar power.Vahid Fotuhi is the president of the Middle East Solar Industry Association and director of origination at Access Power MEA.

Catching the sun: The Middle East's solar energy challengeIf theres one commodity the Middle East has in abundance, its sunlight. Yet, with a few exceptions, in the field of solar energy exploitation, the region is still miles away from fulfilling its potential.With the region simply not converting as much sunlight as it could, many researchers are playing a part to improve the rate.Scientists at the King Abdullah University of Science and Technology (KAUST), are among those working tirelessly in the quest. At KAUST, a major concerted effort relies on 'quantum dots' - semiconducting nanocrystals that can be tuned to absorb light at different wavelengths - exactly what the Middle East needs in lieu of solar cells.We have a lot of light and heat in the infrared region of the spectrum that solar cells dont absorb, one of the scientists toldNature Middle Eastwriter Zeeya Merali as she illustrates the technology and explains the potential of quantum dotshere.But the move towards renewables, including solar energy, is no longer a matter of merely honing technologies but of finding solutions to the growing gap between steep rises in electric demands and waning power generation capacity.In a country like Saudi Arabia, for instance, theres a significant disparity between potential demand and supply, writes Jean-Luc Bredas, director of the Solar and Photovoltaics Engineering Research Center at KAUST, and Mark Vermeesch, the centre's managing director. They warn that relying on traditional oil-fuelled power generators will draw on a much depleted national reserve while exacerbating the effects of climate change.Saudi Arabia has one of the highest irradiation levels on Earth, exceeding 2000kWh/m2/year,they say. This could be the genesis of one of the worlds lowest levelized costs of electricity (LCOE) for renewablesNeighboring UAE boasts a newly-launched eco-city within its capital Abu Dhabi. Masdar City, developed by Masdar Institute of Science and Technology aims to be one of the worlds most sustainable.Founded by a group of international researchers, the coastal Masdar City is powered by Shams 1, one of the largest power plants in the Middle East. The researchers are working on tweaking UAEs solar panels which are hampered by the desert countrys high dust levels.. The dust builds up on the panels and significantly reduces their efficiency. The scientists are committed to producing the perfect hybrid solar cell, but are facing hurdles, including a reluctance by investors to focus on renewable energy instead of oil.Nature Middle Eastwriter Nadia El-Awady explains it allhere.But despite challenges, these projects are producing premium research and trying to influence energy markets by producing more efficient and affordable solar power.The same cannot be said for the much-heralded project, Desertec Industrial Initiative, Desertec was a highly ambitious project for the region, with a projected budget of 400 billion and the financial backing of 19 major shareholders, only three of which remain on board. Desertecs scale of ambition has already receded to the role of a service provider for a few projects in the region, instead of its intended role of a major policy influencer and the founder of an enterprise that would have electrically interconnected the EU and MENA regions.Nature Middle Eastreporter Louise Sarant examinesthe storyof how the ambitions of one solar conglomerate crashed and burned in a region that's brimming with solar energy potential.The problem may rest with the policymakers in governments that give or withhold investment in business or research. Or perhaps the trouble is with the industry itself, which still hasn't found a good middle ground between sustainability aspiration and actual cost. Maybe the right formula lies in aligning research and investment with feasible projections about cost and manpower.Whatever the solution, the reality is not changing: power capacity is weakened and an alternative energy source is desperately needed. Solar power, many scientists agree, is the obvious choice. We need to make it more than just pie in the sky.

The Future of Energy SupplyThis project is not the first of its kind within the country, which has shown a genuine desire to explore renewable options. The year 2013 saw the launch of Shams 1 in Abu Dhabi, a large concentrated solar power plant. It was developed by a subsidiary company of Masdar (specialists in renewable energy), which focuses on creating clean and green energy solutions for both Abu Dhabi as well as for the rest of the world.

Masdar City is another program developed to showcase the feasibility of creating carbon-neutral cities.

Shams 1 and Masdar City are both supplemented by the recent launches of renewable technology incentives. The UAE are far ahead of the game compared to their neighbours.

The Rise of Renewable EnergyWith oil and natural gases forming the basis of the Middle Easts energy power requirements, renewable energy has only recently gained some momentum in this part of the world. The GCC (Gulf Cooperation Council) particularly depends on the usage of fossil fuel. Fossil fuels are seen as being plentiful and unlikely to run out, and they are also an inexpensive option for supplying power locally.

As such, gas and oil are responsible for almost all of the energy used in the United Arab Emirates and the GCC.

There were two main factors that piqued interest in utilizing renewable energy within the Middle East. First was the reduction in cost of certain technologies that are involved in producing renewable energy (such as PV), especially in the previous decade. The second reason is the simple fact of demand; the region wants and needs renewable energy.

Due to the immense economic growth within the UAE especially the rapid development that occurred in the past 40 years energy demand has escalated extremely quickly. The UAE is one of the largest consumers of energy in the world, when looked at per capita. The regions low-cost market for energy also contributes to the populations consumption of renewables, as it reduces the attractiveness of choosing a greener lifestyle in favour of utilising traditional power sources.

A Smart MoveThe UAE and several surrounding nations are opening the doors in regard to energy supply options and also creating policies that will keep the demand for energy in check. The decision to move away from hydrocarbons and move towards alternative energy systems is based in part on the fact that the UAE will become the first country in the GCC to introduce civilian nuclear power. Renewables play a huge part in this strategy as the region enjoys sunshine all year, lending itself to an integration of solar power.

Solar may not be as cost-effective as traditional energy sources at this stage, but the future doeslook bright. With technology progressing continuously, the cost factor will most certainly be reduced, making the value of solar power more evident. This wont only assist the Middle East and the UAE though; even countries with less favourable climates, such as Germany and the UK, will be able to benefit from these developments.

Fossil Fuels Costly from Many AnglesThere are other reasons for the UAE to look at domestic markets regarding new energy sources as well. Heavy dependence on hydrocarbon sources means that the UAE makes use of huge amounts of gas and oil. Due to the money it makes from exporting this resource, every barrel that is not exported is lost revenue for the UAE.

The cost of such heavy reliance on fossil fuels for its domestic energy needs has negative impacts in the long term as well; it could almost take over the initial cost of developing and installing renewable technologies like utility-scale PV solar power.

Benefits of expanding on renewable energy within the region include decreasing their swiftly increasing carbon footprint and opening the path for the development of green energy solutions.

Looking to the FutureThe next point on their agenda should be to streamline various policies within the UAE in order to create more emirate-level initiatives. When focused together, these aims will be a testament to how serious the UAE is about renewable energy while also aiding with manageable and balanced usage of their treasured finite resources.

Is the Middle East the Next Big Market for Solar Energy?Matthew Merfert,First Solars Director of Projects for the Middle East and African markets, moved to Dubai. His mission: to expand the companys photovoltaics business to the sun-drenched deserts of the Arabian peninsula, a region that has been slow to adopt renewable energy sources thanks to its abundant oil reserves. Thats changing though, and First Solar is getting in on the ground floor. I caught up with Merfert along the immaculately over-planned Dubai Marina to hear about the challenges and opportunities of solar energy in the Middle East.Wired: Whats the state of the solar energy field, and how does First Solar fit in?Merfert: Solar energy can broadly be split into four different technology types, each at varying stages of R&D and commercialization: solar hot water, Concentrated Solar Thermal Power (CSP), Photovoltaics (PV), and Concentrated Photovoltaics (CPV). PV, which leads the pack in terms of deployed capacity and lowest cost of energy, utilizes a direct energy conversion process from photons to electrons, requires no moving parts and relies fundamentally on solid-state semiconductor physics. First Solar specializes in thin film Cadmium Telluride (CdTe) PV modules, which offer clear low-cost manufacturing and high-temperature performance advantages. We also recently set a new world record for CdTe module conversion efficiency, achieving 16.1% total area module efficiency in tests confirmed by the U.S. Department of Energys National Renewable Energy Laboratory. While Europe and the United States have traditionally been strong markets for solar power, we have seen growing demand from the Middle East, India, South Africa, China and Japan.Wired: Why is First Solar getting into the game in the Middle East? Is it really a growth area given the regions plentiful and cheap oil?Merfert: Its useful to think of the Middle East as two markets: energy exporters and energy importers. The push towards solar energy in the energy exporting nations may seem paradoxical, since the region is home to more than half of the worlds recoverable crude reserves. But there is a growing realization amongst the energy exporters that investing in solar energy helps to reduce the domestic consumption of oil and natural gas for power generation, freeing up resources for export. With some countries in the region burning as much as a third of their oil output for domestic power needs, there is a strong business case for those hydrocarbons to be exported instead, fuelling economic diversification and growth.In the energy-importing nations, the pitch is different. These countries import significant amounts of energy and often have to face challenges such as supply disruption and fuel price fluctuations. These countries have also started to acknowledge that solar can form an important part of their power generation portfolios, providing a hedge against fuel-price fluctuations and therefore, energy security.Wired: What are the challenges specific to the Middle East region?Merfert: The Middle East presents unique operational challenges and the two most frequently asked questions are about performance in high-temperature and high-soiling environments. If youve spent a summer day in Dubai or witnessed a sandstorm in central Saudi Arabia, you would see that these can have an impact on technical performance.The primary impact of heat on photovoltaic system performance is represented by a PV modules temperature coefficient, which shows the dependence of power performance on temperature. While all semiconductor devices incur increasing losses in conversion efficiency as operating temperature increases, the use of Cadmium Telluride (CdTe) gives us a distinct energy yield advantage when compared against conventional silicon technologies by virtue of CdTes lower temperature coefficient. CdTes temperature coefficient is -0.25% / C, vs. -0.45 to -0.5% / C for silicon. Since PV plants only produce power when the sun is shining, typical module operating temperatures are in the 50-70C range, way above the testing standard of 25C. This translates into as much as nine percent additional energy for each watt installed in a typical hot desert climate.Dust can also impact photovoltaic (PV) system performance. The factors influencing dust settlement on PV modules are well documented, and we measure the soiling on-site through reference modules. Our equipment also goes through rigorous testing for sandblasting, environmental sealing, and corrosion.While we dont need to clean the arrays in the US, where rainfall mitigates annual soiling losses, we do need to provide for cleaning solutions dependent on water availability in the Middle East, India, and parts of Africa. As an energy generation source, PV is an extremely low water consumer when compared to other technologies and we have been working with dry, mechanical solutions to minimize water usage.Wired: Whats the UAE governments stance on solar energy? Is it something theyre actively pursuing, or is it a tough sell?Merfert: The UAE is, in fact, a regional leader in the adoption of solar energy. The emirates of Abu Dhabi and Dubai have both announced programs and have kicked off pilot projects. First Solar has 5MW of modules in Abu Dhabis 10MWMasdar Cityplant, and we are building a 13MW plant in Dubai, which is expected to generate more than 22 million kilowatt hours of electricity per year, on average, which is enough to meet the average annual electricity needs of more than 500 local households. Electricity generated by the power plant will displace an average of more than 14,000 metric tons of CO2 annually, equivalent to removing 1,600 cars from the road every year. The 13MW plant is only first phase of a planned 1000MW solar park. The emirate of Abu Dhabi plans to produce 7% of its electricity from renewable sources including solar power, while Dubai has committed to producing five percent of its electricity needs from solar by 2030.

The case for solar power in the Middle East and North AfricaWe often hear about the Middle East and North Africas (MENA) centrality in global energy markets as it is home to more than 52 and 42 percent of global reserves of oil and gas respectively. The region is also responsible for more than 36 and 20 percent of global oil and gas production.

However, MENA is also the world leader in other aspects of the energy markets, namely energy use and energy intensity (i.e. energy use per $1,000 of output). Between 1981 and 2009 thesegrew faster in MENA than any other region. Furthermore, the gap between MENA and other regions is significant (Figure 1). This is especially true in energy intensity, which saw negative growth rates in all regions during 1981-2009, except for MENA.

These figures highlight the inefficiencies associated with energy usage in MENA, which are partly driven by the fuel subsidies an integral part of the economies of the region. In 2009 alone, energy subsidies in MENA amounted to about US$170 billion (Iran has the highest, at US$65 billion), constituting around eight percent of MENAs US$2.2 trillion GDP. These subsidies are not only expensive but also badly targeted; mostly benefiting the regions wealthiest.

Such inefficient consumption of energy has had adverse effects on the air quality in MENA. Five MENA countries, Saudi Arabia, Egypt, UAE, Iran, and Kuwait are among the top ten countries in terms of PM10 concentrations. Moreover, 29 cities in MENA are among the100 most polluted cities in the world.

One industry in particular bears responsibility for such high levels of pollution in the region: electricity. While MENAs population and GDP have grown at an average annual rate of 2.4 and 5.5 percent between 1981 and 2009, its electricity production has grown by an average annual rate of 7.2 percent, outperforming all other regions such as East Asia (at 6.2 percent) and Latin America (at 4.5 percent). This rapid growth of electricity production has introduced a significant environmental challenge for MENA because 96 percent of its installed capacity is running on fossil fuels. Renewables (including hydropower) account for only about 3 percent of its installed capacity, making the electricity sector in MENA one of the least environmentally friendly in the world. This is especially true for countries where the share of oil in electricity production is more than 50 percent: Yemen (100%), Lebanon (94%), Iraq (92%), Kuwait (71%), Saudi Arabia (55%), and Syria (50%).

While shifting from oil to natural gas is an economically logical strategy for electricity sectors in MENA, it has environmental consequences: 45 percent of current CO2emissions in MENA are fromburning natural gas. Therefore, a shift from oil to renewables, mainly solar power, is the most environmentally sound and sustainable option.

Solar electricity generation is possible in areas with direct normal irradiance (DNI) above 5 kWh per meter square per day, which is true for more than 85 percent of MENA. In a 2008 study, the Center for Global Development reported that solar power in MENA has the potential of meeting 50 to 70 percent ofglobal electricity demand. Therefore, it is technically and also economically feasible (albeit on a level economic playing field and over the long-term) for MENA to meet its internal electricity demand from purely solar power. Furthermore, MENA has the potential to become an exporter of solar energy to Africa and Europe. Europe is an especially ripe and ready market for MENAs solar power. The European Unions (EU) energy strategy, as reported in EU-27sEnergy Roadmap 2050calls for 64 to 97 percent of the EUs electricity to besupplied from renewable sources by 2050.

Besides its role in reducing pollution and the export potential to Europe, solar power provides a stable and predictable price as it does not depend on highly volatile fossil fuel markets for electricity generation, making investments in this sector highly desirable.

In sum, solar power offers MENA tremendous environmental and economic advantages. To achieve them, solar power would need a level playing field to gain access to MENAs electricity industry. Removing fossil fuel subsidies would be a necessary first step in this direction.

The Middle East Eyes Solar As Easy Oil Era EndsDriven by an energy-hungry population and unstable oil prices, countries in the Gulf and the wider MENA region are investing in various green energy options, with a focus on in solar energy.The Middle East could see more than $50 billion investment in its solar power sector by 2020, according to report by Middle East Solar Industry Association (MESIA).The report found that new renewable projects, providing around 37,000 megawatts (MW) of energy, are to be commissioned by the end of this decade. Solar energy projects are forecast to provide around 12,000MW to 15,000MW of power.Saudi Arabia is the largest solar power market in the region with plans to install 23,900MW of renewable energy by 2020. The Kingdom announced plans to spend around $109 billion on solar, in a bid to shift power generation to renewable sources.The UAE too has been stepping up investment in solar. Last year Abu Dhabi launched Shams 1 the worlds largest concentrated solar power plant (CSP) in operation. The 100MW plant, located in the western region of Abu Dhabi, generates enough clean energy to power 20,000 homes in the UAE. Dubai too opened the first phase of a 13 MW photovoltaic park last year, which has the capacity to generate 1,000MW of power when completed.Despite being abundantly blessed with sun throughout the year, countries in the MENA region have traditionally shied away from investing in solar, citing reasons of commercial unviability in the long term.But attitudes have drastically changed in last few years. Experts point out that a combination of rising population and declining oil reserves has increased the appeal of renewables.The traditional dependence on hydrocarbons was driven by what can be termed as an easy oil, easy go phenomenon where the major hydrocarbon producers were finding it relatively easy to get oil and gas from existing sources (as compared to global counterparts), at low costs; while at the same time, the alternate sources of demand for energy were minimal, says Abhay Bhargava, head, energy and power systems practice, Middle East and North Africa, Frost & Sullivan.However, a decline in output from existing production reserves and a need for economic diversification have pushed oil-exporting nations to focus on alternative means of energy, he says.Diminishing production costs have also made solar a viable option for countries in the Middle East.Prices of solar have come down by 50 per cent in the last two years and this has made it more viable, says Vahid Fotuhi, president of the Middle East Solar industry Association (MESIA).As the industry grew, more companies and manufacturers, including China, have entered this sector and this has really pushed down the price. As the manufacturing capacity goes up, the cost will come down.CHALLENGES IN ADOPTING SOLAR ENERGYDespite solar energys current adoption rate in the region, the industry still faces some operational challenges.The combination of heat, dust and humidity is a major challenge that can typically reduce the achievable efficiency of modules, which could endanger the cost competitiveness and financial feasibility of a proposed project, says Bhargava.However, he points out that a bigger challenge that solar would face in the region would be to prove its financial feasibility when compared to electricity generated through subsidised hydrocarbons.The region has conventionally proven to have some of the lowest rates for electricity in the world, and this exerts pressure on solar energy developers to deliver electricity that can compete with conventional sources, he says.A lack of regulation and a quality framework also poses a challenge to the development of solar power generation in the region, according to Fotuhi.Experts say that bringing in benchmarks and standards could be instrumental for the sectors growth.Regulations can play a role in streamlining the procurement process even if FIT or similar mechanisms are not utilised, says Tim Armsby, partner at Eversheds.In addition regulations provide confidence to the market can also establish industry standards. If one looks at the pipeline of renewable energy projects in procurement across the Middle East, it is those countries, such as Jordan and Morocco, which have a clear regulatory framework that are in the lead at the moment.NECESSARY TALENT TO DRIVE SOLAR FORWARDFotuhi says that there is a considerable talent shortage in solar in the region, with not enough trained professionals.But it might not have a drastic effect on the growth of industry in the future, he says.If demand is there, supply will materialise. There is a huge talent pool in Europe and in India, which are all nearby. We will be able to get talent but projects will take a little longer.Bhargava also asserts that a talent shortage will only be an issue if all the proposed investments come online simultaneously.At the moment, it appears that the various governments are working towards a steady and controlled investment outlay with regards to solar energy, in an attempt to minimise supply chain issues. However, a spurt in demand for energy, on account of politico-social factors could challenge these plans, he says.Secondly, the dip in solar investment in Europe has led to an excess capacity of sorts with regards to both labor and products, and this could provide a solution for the pending challenges.In the long term though, the region needs to focus on developing local skills, to ensure that their economies can extract maximum gains from these proposed investments.HEATING UPAs investments in solar industry gain traction in the Gulf, experts foresee a healthy rise in solars contribution to the regions energy mix in a decade.Taking into consideration announced targets and wishlists on the part of the MENA countries, we could expect solar to contribute anywhere between seven to 10 per cent of the total energy mix in the region, with nuclear energy being the other major gainer in this period, says Bhargava.But despite all its challenges, solar energy can offer the Gulf some significant benefits such as economic diversification, conservation oil for exports and reduction of carbon emissions.The key challenge, arguably, is having in place a sustainable, as in long term and viable renewable energy policy, which those committing their funds and resources can rely on, says Michelle Davies, a partner at Eversheds.

One of the biggest banks in the Middle East is betting on solar power

The Gulf States may have been built on oil, but their future is going to be in solar.The opportunity is enormous, the technology exists and, according to a newreportfrom the National Bank of Abu Dhabi, cost is no longer a reason not to proceed with renewables.Ill repeat that for emphasis: this report comes via the National Bank of Abu Dhabi, one of the biggest banks in the Middle East. And it couldnt be more enthusiastic about the investment opportunities in renewable energy.Even oil prices as low as U.S. $10 per barrel, the report finds, cant compete withDubais latest large scale solar project. It references a recentreportfrom Deutsche Bank predicting that solar will be at grid parity in 80 percent of the world in just two years and notes that its already cheaper than grid energy in 42 of the 50 largest U.S. cities. More than half of the money currently pouring into new energy capacity is going to renewables, it finds, as will most of the U.S. $48 trillion in energy investment needed over the next two decades.It is very clear that renewables will be an established part of the global energy mix, Alex Thursby, NBADs Chief Executive acknowledges in a introduction to the report. Governments around the world, including the Gulf region, are setting out their ambitions for decarbonizing their economies, and the global debate about energy has never been more intense.Reneweconomy breaks downwhy this is such a big deal: the Gulf countries demand for new energy capacity is expected to triple over the next 15 years. And renewables, the NBAD is saying, are going to be the most cost-effective way of meeting that demand.RTCCs Ed King, meanwhile, points out that the report could be indicating a shift in the regions historically antagonistic attitude toward anything that isnt oil and gas and possibly even a new willingness to cooperate in international climate negotiations.Solar, after all, is looking like its too good of a deal to turn down.Middle East and North Africa Regionhe Middle East and North Africa (MENA) region holds some of the most advantageous potential for the development of Concentrated Solar Power (CSP) in the world. Countries in the regionAlgeria, Egypt, Jordan, Morocco,Libyaand Tunisiaare looking to take advantage of this world class potential through the use of $750 million from the Clean Technology Fund (CTF) in conjunction with large investments from other sources. The investment plan developed as part of the CTF will: Enable the region to contribute to global climate change mitigation; Support deployment of about 1 gigawatt of CSP generation capacity, tripling worldwide CSP capacity; Support transmission infrastructure in the Maghreb and Mashreq for domestic supply and exports as part of Mediterranean grid enhancement, Enabling CSP scale-up through regional market integration; Leverage public and private investments for CSP power plants and other related projects for over $4.85 billion from sources; Support energy security, industrial growth and diversification, and regional integration in the MENA region.The Investment Plan is designed around deployment of about 1012 commercial scale power plants to be constructed over a 35 year time-frame. The scale of investment will attract private sector partners, result in economies of scale and cost reduction, and promote learning from diverse operating conditions.Middle East & Africa Solar PV Market To Surge By 50% In 2014

The Middle East and Africa (MEA) region is set to see massive growth in solar photovoltaic (PV) demand in the coming years, according to recent findings in the latest NPD Solarbuzz Emerging PV Markets Report: Middle East and Africa.Year-on-year growth in the market in 2014 is expected to be as high as 50%. And, between the years of 2014 and 2018, annual PV demand is expected to essentially triple as the region becomes one of the key markets in the world. By 2018, PV demand in the MEA region is predicted to hit 4.4 GW a year, at least.In 2013, PV demand in the region grew by a very notable 670%. Before 2013, much of the capacity in the region was from small-scale off-grid PV systems, but in 2013 that began to change with growing on-grid capacity being the driving factor behind the surge to 1 GW. Its predicted that by 2018 ground-mount systems will represent more than 70% of the market.Much of the growth in the region has been, until now, driven by just a few economically prosperous countries South Africa, Israel, etc. When taken together with Saudi Arabia, these countries are expected to offer stable demand levels within the MEA region over the next few years. However, the growth is expected to be much more widespread in the coming years.

Solar PV represents an ideal renewable energy type across much of the Middle East and Africa, explained Susanne von Aichberger, an analyst at NPD Solarbuzz. Even so, market drivers and constraints differ greatly between the two regions.NPD Solarbuzzprovides more:In most of the Middle East, renewable energy is seen as a means of preserving domestic oil and gas reserves. Middle East PV demand is forecast to reach 2.2 GW in 2018, with an upside potential of 4 GW. Israel is projected to be the largest PV market in the Middle East in 2014, mainly through solar parks and rooftop systems, based on net-metering.Saudi Arabias ambitious renewables program will finally start to materialize this year, making it the largest PV market in the MEA region by 2016. Saudi Arabia is forecast to add 2.4 GW of new PV capacity between 2016 and 2018. Other key solar PV markets in the Middle East include the United Arab Emirates, Jordan, and Kuwait.With a severe shortage of electricity within Africa, in general, and large parts of the population of Sub-Saharan Africa having no access to electricity, solar PV is considered suitable for helping to stimulate social and economic development in the region. PV demand from Africa is forecast to reach 2.2 GW by 2018, with an upside potential of 6 GW.As far as 2014, PV demand in Africa will remain dominated by South Africa largely because of the construction of several large PV projects via the Renewable Energy Independent Power Producer Procurement Program.In the past 12 months, new plans for large PV projects have emerged across Africa, including the sub-Saharan countries of Cameroon, Swaziland, and Uganda, stated von Aichberger. Announcements of PV projects in the 100 MW range have now become common, as a means of expanding power generation capacity quickly.Weve covered some of these projects already, including one companys plan todevelop 600 MW of new solar PV capacity in Ghana in the next few years, another companys plan tobuild 400 MW worth of solar in Ghana, and a plan tobuild 3,000 MW worth of solar in Nigeria.On a more general level, the government of Kenya has recently been setting its eyes on renewable energy as a whole. Not surprising when you consider the fact that arecent joint study from the UN Environment Programme and the Government of Kenyafound that the country could benefit to the tune of $45 billion by 2030 from such a switch.Middle East awaits dawn of solar power ageOn Saturday,Burj Khalifadimmed its lights to mark Earth Hour, along with millions of people across the region. But when it comes tosolar power, the Middle East needs to turn the lights on.Germany, the worlds leading solar market, has had a bad year in 2014 it installed only 3.3 gigawatts, less than half the year before. Yet across the whole Middle East, excluding Turkey and Israel, there are not even 0.2 gigawatts of solar capacity. In conventional power, mostly from burninggas, the UAE alone has more than 20 gigawatts.Current circumstances are uniquely favourable for expanding solar power. Photovoltaic (PV) costs continue to fall, making it ever more attractive than oil or expensive imported gas. Solar power these days is not a particularly complicated technology, and does not have the safety and political challenges of nuclear reactors. There is a wealth of operating experience from around the globe. With cuts to subsidies elsewhere and the industry struggling with overcapacity, solar companies are searching eagerly for the next big market.Abu Dhabis groundbreakingShams-1solar plant was inaugurated almost exactly a year ago. But it has taken a long time for its successor to emerge: companies first bid for Noor-1 in 2011. But with regulations remaining unclear, it is now unlikely that the project will even go ahead this year.Dubai started later but is catching up fast, based on a sound and cohesive regulatory regime, leadership support and a long-term, step-by-step plan. The next phase of the Mohammed bin Rashid solar park near Bab Al Shams should be ready next year. And energy-poor Jordan is also doing well, showing investor-friendly continuity and concluding its first large agreements last week.Both Dubai and Abu Dhabi have been working on regulations for householders to install their own PV systems, with Abu Dhabi running a small pilot project. But while solar panels are now a standard feature of urban roofscapes in cloudy Germany and Britain, they are almost invisible in the sunny Gulf.Saudi Arabia has been even more frustrating. In 2012, the kingdom announced plans for some 40 gigawatts of solar power, costing US$109 billion, in the period up to 2030. The King Abdullah Centre for Atomic and Renewable Energy then ploughed through an extensive process of consultation aiming not only to generate solar power, but also to create local industries and employment. Still, the Middle East Solar Industry Association believes the policy and funding framework needed to light up the Saudi solar programme is not in place, and unlikely to appear this year.Such unfulfilled expectations are dangerous. Solar companies often struggling with poor margins elsewhere and without the deep pockets of oil companies set up in the region but lose faith and withdraw staff after waiting years for projects. It will be harder to entice them back next time.One of the lessons from the German experience has been that it is vital to create an ecosystem of solar developers, suppliers and installers, to reduce costs and ensure consistent quality. This will not emerge while solar companies continue to struggle with stop-start activity. Much better a steady stream of smaller projects, than an expected tidal wave that never arrives.Middle East governments need to set consistent policies and pricing schemes, not ad hoc provisions, to allow solar power to compete fairly. If subsidies on electricity prices are not removed, at least they should be made transparent so householders and businesses can make an economically sensible decision on installing solar panels.Conditions have never been more favourable for the solar industry to boost the regions energy supply, environment and economy. But the Middle East needs to find more responsive and flexible commercial models, or the lights will stay off on its solar dawn.Dubai Will Invest $3 Billion To Boost Solar Power Project Capacity To 3 GW

Solar energy seems to be the new go-to investment segment in the small Middle East country of United Arab Emirates.The power and water utility servicing the iconic city of Dubai will invest $3 billion to boost the generation capacity of the countrys largest solar power plant from 1 GW to 3 GW. Saeed Al Tayer, managing director and CEO of Dubai Electricity and Water Authority (DEWA), recentlyannouncedthat the installed capacity of the Shaikh Mohammad Bin Rashid Al Maktoum Solar Park would be increased significantly.The initial installed capacity target for the solar park was 1 GW by 2019, with an investment of $3.3 billion. DEWA now plans to increase the parks installed capacity to 3 GW by 2030. This will be inline with the United Arab EmiratesVision 2021, which requires the country to source 24% of its energy requirement from clean energy sources like renewable energy and nuclear energy.The Shaikh Mohammad Bin Rashid Al Maktoum Solar Park waslaunchedin 2013 when a 13 MW block of solar photovoltaic power system was commissioned. The second phase of the project, however, was a blockbuster affair and grabbedthe worlds attention. Through a tender, Saudi project developer ACWA Power secured therights to develop 200 MW capacity at the park at a record-low levelised tariff of 5.84/kWh.The expansion announcement of the solar park comes just days after the Federal Electricity and Water Authorityannounced that it will set up100 MW of solar power capacity in the northern region of the country.

ConclusionSolar power in middle is the rising energy for all purposes after oil soon or later solar energy in Middle East will replaces oil or natural gas energy. Many gulf kings are investing billions of dollars to develop solar energy in their region with is renewable and safe to our environment.

References

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