Alongside regional leaders, US Secretary of State Antony Blinken will attend the meetings
world3 hours ago
All renewable technologies will be competitive by 2020 compared to fossil energy with the cost of generating power from wind and solar set to plunge in two years.
The trend signals a significant shift in global energy paradigm as the share of renewable energy in the Middle East is poised to surge phenomenally on the back of increasing focus given to renewable sources by the UAE and other GCC countries, energy experts said.
A new cost analysis report from the International Renewable Energy Agency says that cost of onshore wind power has fallen by around a quarter since 2010, with solar photovoltaic (PV) electricity costs falling by 73 per cent in that time, making renewable far more affordable than conventional sources.
The report also highlights that solar PV costs are expected to halve by 2020. The best onshore wind and solar PV projects could be delivering electricity for an equivalent of ten fils (three US cents) per kilowatt hour (kWh), or less within the next two years.
Global weighted average costs over the last 12 months for onshore wind and solar PV now stand at six US cents and 10 US cents per kWh respectively, with recent auction results suggesting future projects will significantly undercut these averages. The report highlights that onshore wind is now routinely commissioned for four cents per kWh. The current cost spectrum for fossil fuel power generation ranges from 5-17 cents per kWh.
"This new dynamic signals a significant shift in the energy paradigm," said Adnan Z. Amin, director-deneral of Irena. "These cost declines across technologies are unprecedented and representative of the degree to which renewable energy is disrupting the global energy system."
In the Middle East, power generation capacity from renewables is expected to increase to 100 gigawatts from 16.7 GW, requiring energy storage solutions, according to Siemens' report 'Middle East Power: Outlook 2035'.
The UAE has launched mega projects to invest $163 billion in projects in a bid to generate almost half the country's power needs from renewable sources as it seeks to reduce dependency on fossil fuels to generate power, including building nuclear facilities.
While Dubai has launched the Mohammad Bin Rashid Al Maktoum Solar Park that envisages a capacity of 1,000MW by 2020, and 5,000MW by 2030, and a total investment of Dh50 billion, Abu Dhabi has initiated Shams 1 project, one of the world's largest concentrated solar power, generating electricity to power around 20,000 homes in the UAE annually.
It is hoped that by 2050, 44 per cent of the UAE's energy needs will be provided by renewables, with 38 per cent from gas, 12 per cent from cleaner fossil fuel and six per cent from nuclear energy.
While natural gas will remain region's primary fuel source by 2035 despite the growing share of renewables, digitalisation and cloud tech will drive energy and cost efficiency, but firms must prepare for greater exposure to cyber security risks, Siemens' report said.
Region expected to need total of 483 GW of power generation capacity by 2035.
While the energy mix will see significant diversification over the next 20 years, natural gas will remain the prime energy source for power generation in 2035, said Dietmar Siersdorfer, CEO, Siemens Middle East and UAE.
Siersdorfer said the region is expected to require a total of 483 gigawatts (GW) of power generation capacity by 2035, an addition of 277 GW from 2016, according to a new energy outlook report by Siemens. Within this, the share of renewables in the power mix is expected to more than triple from 5.6 per cent (16.7 GW) in 2016 to 20.6 per cent (100 GW) in 2035.
Irena's power generation cost report, released on the first day of its Eighth Assembly in Abu Dhabi, highlights that other forms of renewable power generation, such as bioenergy, geothermal and hydropower projects in the last 12 months have competed head-to-head on costs, with power from fossil fuels.
The findings note that by 2019, the best onshore wind and solar PV projects will be delivering electricity for a three US cents per kWh, significantly below the current cost of power from fossil fuels.
"Turning to renewables for new power generation is not simply an environmentally conscious decision, it is now - overwhelmingly - a smart economic one," said Amin. "Governments around the world are recognising this potential and forging ahead with low-carbon economic agendas underpinned by renewables-based energy systems. We expect the transition to gather further momentum, supporting jobs, growth, improved health, national resilience and climate mitigation around the world in 2018 and beyond."
The report also highlights that auction results are signaling that offshore wind and concentrating solar power projects commissioned in the period between 2020-22 will cost in the range of 6-10 US cents per kWh, supporting accelerated deployment globally.
- issacjohn@khaleejtimes.com
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