Ongoing UAE power sector investments exceed $26b

The ongoing power sector investments in the Middle East and North Africa exceed $250 billion, as the region is expected to add 5.6 GW of installed capacity from renewables in 2022, nearly double the 3.0 GW that came online in 2021.

According to the data released by industry experts at the Mena Power Projects Forum, among the current top 25 power projects in the Mena region, nine are in the UAE. In terms of project value, the UAE comes third with $26 billion worth of power projects under planning and development.

The UAE is at the forefront of the energy transition from fossil fuels to renewable energy and a green hydrogen ecosystem.

“The UAE Energy Strategy 2050 has clear objectives: Increasing the share of clean energy in the total energy mix to reach 50 per cent by the year 2050; reducing the carbon footprint of power generation by 70 per cent and increasing consumption efficiency of all users by 40 per cent,” Yousif Ahmed Al Ali, assistant under-secretary for Water, Electricity and Future Energy Affairs, Ministry of Energy and Infrastructure, told delegates.

Al Ali said over the next decade, the UAE will focus on driving clean electrification through solar and nuclear power, implementing transparent policy, improving energy efficiency, reducing methane emissions, and turbocharging innovation to commercialization of hydrogen, accompanied by strategies to unlock capital flows in support of clean energy transitions and ensure reliability and affordability.

Of the total power sector investments in Mena, nearly $60 billion worth of projects are being developed in Saudi Arabia, followed by Egypt accounting for $37 billion worth of projects, industry experts revealed at the event that opened on Wednesday in Abu Dhabi.

Mohammed Al Taani, secretary-general of the Arab Renewable Energy Commission, said, the Arab World will see more than 300 million Electric Vehicles in operation by 2040.

“Arab World will witness $700 billion investment in renewable energy transition between 2020 and 2050 with a target to generate more than 70 Gigawatts of power from renewable energy by 2050,” he said. “Hydrogen and EVs future up to 300 million vehicles by 2040 and more than 60 per cent of the total active vehicles by 2050.”

The Mena region is expected to add 5.6 GW of installed capacity from renewables in 2022, nearly double the 3GW which came online in 2021. By 2026, the region is expected to add 33GW by the installed capacity of renewables. In the meantime, global energy investment in the energy sector is set to increase by 8 percent to reach $2.4 trillion in 2022.

More than 200 delegates including senior government officials, project owners, project management professionals, project developers, contractors, sub-contractors, technology providers, utility suppliers, industry experts, and key stakeholders participated in the two-day forum.

“Investment is increasing in all parts of the energy sector, but the main boost in recent years has come from the power sector – mainly in renewables and grids – and from increased spending on end-use efficiency,” the International Energy Agency said in a report.

“Clean energy investment is – finally – starting to pick up and is expected to exceed $1.4 trillion in 2022, accounting for almost three-quarters of the growth in overall energy investment.”

Due to the high cost of fuel, the total energy bill paid by the world’s consumers is likely to top $10 trillion for the first time in 2022, it said.

— issacjohn@khaleejtimes.com