RISE OF GCC ALTERNATIVE ENERGIES TABLE OF CONTENTS GCC RESPONSE TO LOWER OIL PRICES CONCLUSIONS

Transcription

1 GCC RENEWABLE ENERGY LANDSCAPE AND INTEGRATION CHALLENGES 1

2 RISE OF GCC ALTERNATIVE ENERGIES GCC RESPONSE TO LOWER OIL PRICES CONCLUSIONS TABLE OF CONTENTS 2

3 RISE OF GCC ALTERNATIVE ENERGIES 3

4 RENEWABLE ENERGY GAINING GROUND IN THE REGION Cost of solar and wind declining Now competitive in the right locations & with right market design Lenders bullish on renewables Renewable projects bankable for both regional and international banks Changing and evolving business models Distributed generation and advanced grid technologies Nuclear power generation offers large-scale, dispatchable, low-c power Growing regional interest but challenges on delivery Search for alternatives to gas Captured CO 2 for EOR; solar thermal steam Utility (power and water) projects most likely to go ahead as demand grows Need to meet demand in most costeffective way given strained budgets 4

5 GCC IS RICH IN RENEWABLE POTENTIAL (MOSTLY SOLAR) Total solar radiation (PV) Direct solar radiation (CSP) GCC focuses on Solar PV because it is cheaper Advantage of CSP is its thermal storage Possibility of PV power with storage Wind speeds 5

6 Bid price (USc/kWh) DRAMATIC FALLS IN SOLAR PV POWER BIDS 7 6 Dubai Dubai Abu Dhabi 1 18/9/214 27/12/214 6/4/215 15/7/215 23/1/215 31/1/216 1/5/216 18/8/216 26/11/216 Source: Qamar research 6

7 SOLAR PV ATTRACTIVE VS TRADITIONAL GENERATION Gas CCGT, $12/MMBtu Diesel turbine, $5/bbl Nuclear Onshore wind Gas CCGT, $6/MMBtu Solar rooftop Coal CCS Gas CCS, $6/MMBtu Conventional coal Gas CCGT, $1/MMBtu Solar PV Electricity price (c/kwh) Transmission & distribution Low case Solar and wind now competitive against gas, and particularly against oil Alternative energy sources solar, nuclear and coal CCS are being pursued actively by several Gulf countries UAE helping drive down renewable costs o Abu Dhabi receives world record solar bid on the Sweihan 35MW PV project (IPP) at $.242/kWh o DEWA bid for the solar PV 8MW third phase Mohammed bin Rashid al-maktoum project at $.299/kWh o DEWA said there could be a CSP price of $.8/kWh cents for the fourth phase of the MBR project Source: Qamar research 7

8 Qamar Energy SOLAR THERMAL A LARGE-SCALE, IF NICHE, TECHNOLOGY Glasspoint for Petroleum Development Oman $6 million, 121 MW thermal Steam for recovery of heavy oil Potentially applicable in Saudi Arabia, Kuwait, Iraq, Iran, Bahrain

9 MATCHING SUPPLY AND DEMAND 9

10 : 1: 2: 3: 4: 5: 6: 7: 8: 9: 1: 11: 12: 13: 14: 15: 16: 17: 18: 19: 2: 21: 22: 23: Solar generation (MW) : 1: 2: 3: 4: 5: 6: 7: 8: 9: 1: 11: 12: 13: 14: 15: 16: 17: 18: 19: 2: 21: 22: 23: Solar generation (MW) APPROACHES STILL NEEDED TO MATCH SOLAR SUPPLY WITH ELECTRICITY DEMAND 1 Based on typical UAE conditions for an example market 8 6 March 4 2 Other generation Solar Solar helps meeting midday summer peak Solar August 4 2 Other generation Solar does not help with early evening summer peak Source: Qamar research 1

11 Generation (MW) Generation (MW) Qamar Energy : : 1: 1: 2: 2: 3: 3: 4: 4: 5: 5: 6: 6: 7: 7: 8: 8: 9: 9: 1: 1: 11: 11: 12: 12: 13: 13: 14: 14: 15: 15: 16: 16: 17: 17: 18: 18: 19: 19: 2: 2: 21: 21: 22: 22: 23: 23: LCOE NOT ENOUGH NEED TO EVALUATE SOLAR AS ONE COMPONENT OF SUPPLY 1 8 March 6 4 No need for high-cost gas/imports 2 Low-cost gas Solar Low-cost gas baseload, solar midday, high-cost gas/imports for evening August High-cost gas / imports 11

12 Qamar Energy OPTIONS FOR SOLAR POWER INTEGRATION Flexibility Gas (with/without CCS) Solar CSP Waste? Nuclear? Demand Load-shifting / peak-shaving District cooling Renewable cooling Energy efficiency Storage Utility batteries Electric vehicle batteries Pumped hydro Thermal (ice, concrete) Desalinated water (reverse osmosis) Other storage (compressed air, chemical, etc.) Diversification Interconnectors Other renewables (wind, geothermal) 12

13 Demand, generation (GW) Demand, generation (GW) 1, 1, 5, 5, 9, 9, Qamar Energy 13, 13, 17, 17, 21, 21, 25, 25, 29, 29, 33, 33, 37, 37, 41, 41, 45, 45, 49, 49, 53, 53, 57, 57, 61, 61, 65, 65, 69, 69, 73, 73, 77, 77, 81, 81, 85, 85, 89, 89, 93, 93, 97, 97, 11, 11, 15, 15, 19, 19, 113, 113, 117, 117, 121, 121, 125, 125, 129, 129, 133, 133, 137, 137, 141, 141, 145, 145, 149, 149, 153, 153, 157, 157, 161, 161, 165, 165, Stored (GWh) Stored (GWh) STORAGE OFFERS PATH TO 1%-PV SOLUTION Demand, generation, storage (January) Demand To storage Solar generation From storage Stored Demand, generation, storage (August) Demand To storage Solar generation From storage Stored 13

14 HOWEVER ENORMOUS AND EXPENSIVE STORAGE REQUIRED System dimensions (illustrative) Maximum demand 1 GW Solar PV capacity 33.9 GW Cost $33.9 billion (at $1/W) Storage system capacity 52 GWh (15 hours of all solar output) Cost $52 billion (at $1/kWh) Maximum discharge rate 16 GW More intelligent systems can be more practical and cheaper Flexible generation Demand management Options for electric vehicle storage Source: epwak (October 216) 14

15 RENEWABLE ENERGY INTEGRATION Main issue is likely to be solar PV integration Most applicable and lowest-cost renewable energy in the GCC Gas/PV combination will provide reliable, flexible generation but limits PV penetration to ~3% of total demand (~5% of capacity) Grid integration requires upgrades but not likely to be problematic Close match of demand with solar PV generation (within day & seasonal) makes balancing easier Numerous options for storage and balancing Some technically proved Commercial cases to be established Some require additional R&D Main barriers are commercial / regulatory Time-of-use pricing Capacity / storage pricing? Cost-reflective tariffs Smart meters and controls International agreements on interconnectors and electricity trade 15

16 CONTACT DETAILS Robin Mills, CEO, Qamar Energy, Suite 32, 33rd Floor, HDS Business Centre, Cluster M, Jumeirah Lake Towers, PO Box 41332, Dubai, UAE

17 APPENDIX 17