Saeed Mohammed Al Tayer, Managing Director and CEO, Dubai Electricity and Water Authority (DEWA): Interview

Interview: Saeed Mohammed Al Tayer

How have corporations responded to Dubai’s independent power producer (IPP) model?

SAEED MOHAMMED AL TAYER: DEWA received 49 applications for the second phase of the Mohammed bin Rashid Al Maktoum Solar Park in response to its open request for qualifications. In January 2015 we announced that the production capacity of the second phase of the solar park will be increased from 100 MW to 200 MW. It is one of the biggest new IPP projects in the renewable energy market worldwide. The consortium, led by ACWA Power and TSK, was selected based on its proposal for 200 MW with a levelised cost of energy of approximately $5.85 per KWh. DEWA has also awarded the contract for IPP advisory services for the first phase of Hassyan Clean Coal Power Plant to an international consultancy firm. The project will use clean coal as feedstock for electricity generation. DEWA received a total of eight bids for IPP advisory services for the first phase, which has a capacity of 1200 MW, and is set to be operational by 2020. The output of phase one will be 1200 MW in total from two units, with the first to be commercially operational by March 2020 and the second in March 2021. DEWA plans two further phases of the plant, which will also use the IPP model.

How might considerations over electricity and water pricing shape Dubai’s future policies?

AL TAYER: For many years, solar-powered electricity generation in the Middle East has been limited to a few research and testing facilities, a handful of utility-scale solar parks and a scattering of small-scale off-grid systems. Now, a new resolution allows customers to install photovoltaic (PV) panels for the production of electricity from solar power in buildings, as well as connect them to the grid. This makes Dubai the first city in the Middle East to put in place a comprehensive framework at the legislative level that will allow customers to install PV generation systems.

When the generating unit is producing more power than required at the premises, the excess energy is fed into the grid to serve other customers. The benefit for the customer feeding energy into the grid is that the customer’s bills will be balanced.

This remuneration scheme, based on “net-metering”, is attractive, especially in light of declining equipment costs and the high level of solar irradiation in Dubai that guarantees high yields. This has the potential to catalyse greater interest in eco-friendly solutions and corporate social responsibility commitment.

What challenges must be overcome before a unified GCC strategy on energy and water consumption can be agreed upon?

AL TAYER: GCC countries must adopt a unified strategy on energy and water consumption. Governments should invest in research and development to adopt the best solutions for energy production and water desalination, while also moving toward renewables. Funding should be directed at smart grid systems and the integration of renewable energy. Now the priority is to meet energy demand for the next 30 ciency should be a priority in all sectors, through the right mix of energy resources during peak hours.

With domestic use soaring, how is policy being formulated to encourage responsible usage?

AL TAYER: The Demand Side Management Strategy targets a 30% reduction in energy consumption by 2030, with eight programmes that include green building specifications and regulations; building retrofitting; district cooling; waste water reuse for irrigation; lighting systems; and standards and labels for appliances and equipment. The mechanisms involved are capacity-building, promoting public awareness, adequate policy and regulatory frameworks, information systems and financing mechanisms adapted for Dubai. DEWA has already achieved Dh662m ($180m) of savings, including 1012 GWh of electricity and 5bn gallons of water, through conservation campaigns and programmes covering all sectors between 2009 and 2013.