Abu Dhabi: Power savings

With demand for electricity and water rising quickly, authorities in Abu Dhabi have taken steps to reduce consumption, including the introduction of a billing system that will indicate usage more clearly to consumers. Meanwhile, a recent study by an international consultancy firm shows that the introduction of some power-saving techniques could reduce electricity demand in the UAE by up to 50%.

As of March, a new utility bill for water and electricity has been enacted for the emirate, according to announcements by the Regulation and Supervisory Bureau (RSB). In addition to providing information regarding usage, residential customers will also be able to see “ideal” and “above-ideal” consumption ranges for different property types. For example, the ideal amount of electricity usage for a flat is less than 20 units per day, while the daily figure for water is capped at 700 litres.

The new bill also indicates the government subsidy that has been paid for the amount of electricity and water consumed. In Abu Dhabi – as is the case in much of the Gulf – the government heavily subsidises utilities prices. Indeed, for nationals in Abu Dhabi, water is provided at no cost. Electricity is not free, but the price has been held constant for the last 15 years, despite the rising cost of natural gas, the primary feedstock for the emirate’s power plants.

While the re-designed bills do not change pricing, there is an expectation consumers could reduce their consumption when presented with additional information regarding usage. “We know that there is a better chance of changing consumer behaviour if customers are informed about the consequences of their actions,” Nicholas Carter, the director-general of the RSB, told OBG. “The introduction of our new billing system is part of a larger programme designed to inform consumers about the value of utilities compared with the prices they are being charged.”

The RSB, Abu Dhabi’s independent utilities regulator, has been proactive in raising awareness of energy use and therefore, it is hoped, encouraging conservation. Long an advocate of lower subsidies on electricity and water, the RSB has pointed out that cheap utilities encourage levels of energy and water consumption that cannot be supported in the long run. In 2011 it began publishing the unsubsidised price of electricity on consumers’ bills, allowing households and businesses to see how much they would be paying if the government were not picking up part of the bill.

While eliminating or limiting the system of subsidies that exists in Abu Dhabi – and across the GCC – could assist in lowering demand for electricity, an alternative would be to encourage the adoption of energy efficient technologies. According to a report by Oliver Wyman, a global management consultancy, the UAE could reduce its annual energy costs by up to Dh11bn ($23bn) through the implementation of power-saving techniques.

Marc Hoffman, a partner at Oliver Wyman and co-author of the study, told local daily Gulf News in February that now is a good time to look at energy conservation. “Even moderate adoption of proven energy efficiency measures could reduce energy demand by one-quarter to one-half in the year 2030, greatly freeing up capital,” he said.

The consultancy’s report showed that, assuming a constant cost of electricity production, the UAE could save 51% of residential energy usage, while this figure stood at 38% and 11% for the commercial and industrial sectors, respectively.

Some simple changes could go a long way towards reducing power consumption, Khalid Malallah Al Awadi, a UAE energy expert, told Gulf News. “[T]he use of insulated doors, windows, roofs and walls, use of district cooling instead of window air conditioners, use of low-wattage high luminous lights instead of halogen or sodium light bulbs can significantly increase energy savings,” he said. However, in the absence of price increases, it may be difficult to convince consumers to invest in these new technologies or otherwise change their behaviour.

More environmentally friendly building practices are also needed to help reduce the growing demand for energy and water. An example of this is Masdar City, which aims to integrate renewable technology while also housing 40,000 residents and the Masdar Institute of Science and Technology, has offered a promising opportunity to explore ways of adapting modern building practices to the Gulf’s climate.

Traditional desert construction methods – which make use of narrow, shaded alleys and wind tunnels to regulate temperature – have been melded with modern building technologies, including solar power and high-density insulation, to create a carbon-neutral environment for the Masdar Institute’s 150 residents. Scaling up this technology – both for the next phase of the city’s development and for use in the wider world – is an ongoing goal of the Masdar Initiative, state-owned investor Mubadala Development Company’s effort to turn Abu Dhabi into a centre for renewable energy research and development.

The wider adoption of similar building practices in the construction industry would go a long way to reducing electricity and water consumption. Until then, however, the government’s focus on educating citizens of the exact amount of power they consume – and how much it costs – is expected to reduce usage in the private realm.