It is only a matter of time before the Middle East government bodies make solar power a necessity through incentives such as feed-in tariffs and attractive subsidies, say specialist contractors and suppliers
You would expect an aerial view of the sunny Middle East to reveal a blanket of power generating solar panels in designated clusters and lining the roofs of its many large buildings.
However, the number of structures incorporating this technology is relatively small when you compare to some less-sunny European countries, such as Germany. The reason for this, according to various contractors and suppliers, is a lack of government incentives to install solar panels; however, it is only a matter of time before this changes: “What you see in other regions is implementation of feed-in tariffs by government, which promises to buy back clean energy generated at around US 30-40 cents per kilowatt hour. So anyone can put solar modules on a roof and sell the energy back to the government; it’s an initial investment and slow payback period,” explains Enviromena Power Systems LLC VP-technical Sander Trestain.
“Germany was the first country to do this and it was a fabulous success for the promotion of solar capacity. “The secondary benefits include decentralised power production and a decreased demand on the energy grid, which can reduce the overall cost of solar energy.”
But, as AT Kearney, Dubai, principal Christian von Tschirschky point out; there are currently no feed-in tariffs in this region: “Solar needs to compete economically with generation fuels, such as oil and gas, which are highly subsidised,” adds Tschirschky.
And this is a problem because the cost of electricity produced by a solar power plant — taking into consideration a large initial investment, but low running costs and a life-span of around 25 years — is around US 25-27 cents per kilowatt hour, says Trestain. This is cheaper than conventional electricity in some parts of the world, but not in Dubai or Abu Dhabi for example.
“Governments need to further focus on solar [power] and need to establish a favourable regulatory and investment environment, which pushes investments into solar. For example, by introducing attractive feed-in tariffs and reducing subsidies for fuels such as oil and gas,” adds Tschirschky. “Governments have to evaluate from the country macro perspective that it makes economically more sense to sell oil and gas to the world markets at attractive prices than to burn it”.
While both experts say more needs to be done to push solar power, it seems things are moving in the right direction. Trestain acknowledges that when the company set up in 2007, there was no demand for solar energy, no installed capacity and no drive for projects to bring solar into their power portfolio. But now, there’s a large pipeline of upcoming projects in the region driven almost exclusively by government programmes. The government is the client, he asserts. One of the most significant examples of this is Enviromena’s installation of a 55-acre, 10 megawatt (MW) solar power plant producing 17,500 megawatt hours of energy per year within Abu Dhabi’s Masdar City.
The plant is the largest in the Middle East and is grid connected. The solar panels are ground mounted on steel and concrete racking systems.
Trestain says the intention is to offset energy used during the construction phases of the city by putting clean energy back into the system. Furthermore, the plant fits into the master plan of the city and therefore will continue to be one of the site’s clean energy sources. Pilot projects, such as the Masdar City, the 10MW Solar One and Solar Two heliostat demonstration projects in the Mojave Desert and the 15MW Solar Tres Power Tower in Spain, are proving the capacity of solar power
However, there a still obstacles with the technology: “Panels require regular cleaning to be fully efficient, this requires access to water which is again an expensive source — this hurdle can be overcome if Concentrating Solar Power (CSP) is combined with desalination and water can be used for cleaning the panels, says Tschirschky. “Once built, solar-panel maintenance is extremely cheap, there are no moving parts or fuel, and typically running costs only amount to 1% of the system price,” adds Trestain. Integrating solar solutions from the drawing stages of a development can keep costs down and results in a more aesthetically-pleasing, smarter design. Enviromena has a team of engineers specialising in developing customised, effective and attractive systems and there are a number of solar products on the market, available in different colours, shapes and designs.
That’s not to say buildings cannot be easily and adequately retrofitted, asserts Tschirschky, adding that 90% of the photovoltaic (PV) solar installations in Germany have been retrofitted. So with an increasing interest from the private sector and the technology in place, it seems that the Middle East is just waiting from the governmental incentives to exploit solar power; and this could be on the cards in the not too distant future.
“We expect government subsidies to be reduced for oil and gas in the mid- to long-term which will make solar more competitive,” says Tschirschky.
“Solar industry has the opportunity to create up to 100,000 jobs in MENA if governments drive the solar story, set-up production facilities and operate solar plants,” he adds. And in the meantime, Trestain says that developers investing in solar power wont just have a clear conscience; they can reap the public relations benefits of operating a corporate socially responsible business, just as Google did with the launch of its solar power plant at its California head office.