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INTERVIEW: UAE's Abu Dhabi to produce 1/3 of power from clean energy in 4 years

Highlights

Abu Dhabi achieved a then-record low solar PV tariff in April

UAE is first GCC country to generate nuclear power

Country wants 50% of power to come from clean energy by 2050

Dubai — Abu Dhabi, the oil-rich emirate in the seven-member UAE federation, plans to generate a third of its power from clean energy, including nuclear reactors, in four years, a government official told S&P Global Platts, as the country diversifies its energy mix and frees up oil and gas for export.

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Abu Dhabi, which sits on most of the UAE's oil and gas resources, is forging ahead with its renewable and nuclear power projects despite delays from the COVID-19 outbreak. The emirate has been making headway in solar projects after its 2 GW al Dhafra solar project achieved a then-record low tariff of 1.35 US cents/kWh in April.

"When the 2 GW al Dhafra solar photovoltaic independent power producer project is completed by 2022, it will bring the total solar power generation capacity in the emirate to 3.2 GW," Awaidha al-Marar, chairman of the Abu Dhabi Department of Energy, said in a written interview. "If we add in the baseload nuclear energy expected upon full operation of the four nuclear reactors at the Barakah plant, we will be talking about 8.8 GW of installed clean and renewable energy capacity within three to four years – that would represent more than 31% of the total energy mix in Abu Dhabi."

50% goal

The UAE plans to generate half of its energy mix from clean and renewable energy, including nuclear power, by 2050 and is undertaking various projects to reach its goal.

This year, the UAE became the first Gulf Cooperation Council country to generate power from nuclear energy with the start-up of one of four nuclear reactors. Saudi Arabia, Bahrain, Kuwait, Oman and Qatar are other GCC members. Once all plants are operational, they will produce 5.6 GW of nuclear energy, meeting up to 25% of the UAE's power needs.

The Dubai Electricity & Water Authority this year awarded Saudi Arabia's ACWA Power the 900 MW fifth phase of the Mohammed bin Rashid Al Maktoum solar park, a project that aims to have 5 GW of solar power by 2030 at a cost of 50 billion dirhams ($13.6 billion).The $2 billion fifth phase project achieved at the time it received bids in October last year an international record low bid of 1.6953 US cents/kWh.

In 2019, Abu Dhabi generated 2,163,799 MWh of electricity from renewable sources.Elsewhere in the Gulf, countries are pressing ahead with their solar projects as well, despite COVID-19.

COVID-19 delays

Qatar, Total and Marubeni Corp. plan to develop an 800 MW solar power plant near the capital Doha. In Oman, the biggest Arab oil producer outside OPEC, Petroleum Development Oman this year began operations of the sultanate's first utility-scale solar power plant, which will free up 95.5 MM cm of natural gas for export annually at a time where the country's oil revenue has shrunk due to the oil price rout and commitment to OPEC+ oil output curbs.

In Saudi Arabia, the world's biggest oil exporter, the ministry of energy in April extended the request for proposals deadline for its 1.2 GW solar project to six from four months due to the COVID-19 outbreak.

Abu Dhabi's clean energy plans may have been delayed by the COVID-19 outbreak, but the emirate is determined to see projects through, Marar said.

"There might have been slight delays in awarding bids for the 2 GW Al Dhafra solar project or the delivery of materials and supplies shipped from various parts of the world due to lock-downs, but we remain on track to execute our renewable projects within the agreed timelines," he said.

Hydrogen plans

Abu Dhabi is also looking at hydrogen as a means to further its clean energy agenda. It would join the ranks of Saudi Arabia, which in July unveiled a partnership between ACWA Power and US' Air Products to develop a $5 billion green hydrogen-based ammonia production facility powered by renewable energy in the $500 billion futuristic city of NEOM.

"We will continue to bring more renewable energy projects online by leveraging our solar irradiation resources and boosting exploration of enabling technologies such as renewable hydrogen," Marar said. "As we rebuild from the crisis, we expect rapid deployment of renewable energy, especially solar PV, on the one hand because it is a cheaper technology to produce power; on the other, it is a good business case to accelerate Abu Dhabi's sustainable development agenda and drive economic diversification." Abu Dhabi's clean energy push is supported by the cheap cost of renewable energy, mainly solar PV, and the UAE's commitment to the Paris Climate Change Agreement as a signatory, Marar said.

"Renewable energy, particularly solar PV, makes economic sense with its cost competitiveness compared to upgrading conventional power plants or constructing new ones," he said. "The cheap cost of solar PV means a lower cost for developing other clean fuels like green and blue hydrogen."