14.00 Hannes Reinisch Renewable Energy Sustainable Dewelopment PwC

8/16/2019 14.00 Hannes Reinisch Renewable Energy Sustainable Dewelopment PwC

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Renewable Energy in MENA– Why and How?

Hannes ReinischSenior Manager,

www.pwc.com

Renewable Energy and Sustainability Advisory, PwC

MEED Renewable Energy Conference –September 2012


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1. What makes the Middle East special for Renewable Energy?

2. The big question: Renewables vs. Oil & Gas vs. Nuclear?

3. The untapped supply: larger and smarter Grids

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4. Plus: A sneak preview of the UAE Solar Survey 2012(Report to be published in October 2012 in collaboration with ESIA


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1. What makes the Middle East Special? A few contextual points

• More Power Needed – Stark Electricity Demand Growth

• Cheap Electricity ...is becoming more and more expensive

• We have plenty of Sunshine

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• Each MENA country is different


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More Power Needed –

Stark Electricity Demand Growth SaudiArabiaOman

UAE

Qatar

Kuwait

Jordan

Egypt

7-11% year on year

Dubai

Today 2020 2030

50TWh 110TWh

14GW 23GW Abu Dhabi

=120%

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KSA 45GW 121GW 65GW

=

=175%=44%


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Electricity is cheap in parts of MENA

MENA Avg. Prices ($cents/KWh)

UAE lowest 0.8

Saudi Arabia 1.3

Qatar 2.2

Tunisia 4.7 Algeria 4.8

UAE highest 8

Kuwait 7

Rest of World

Avg. Prices($cents/KWh)

Germany up to 35

Spain 27

Australia 25

UK 21

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Bahrain 8

Morocco up to 19

Jordan up to 45

California 16

China 9


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Cheap electricity is.......becoming more and more expensive

Opportunity Cost of subsidised electricity :

= ( Oil/Gas Market Price, Population, Electricity Price, etc.)

Foregoneexport

(un) collectedelectricity

Local powerdemand

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OIL & GASEXPORTINGCOUNTRIES


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Importexpenditure

Local powerdemand

(un) collectedelectricity

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OIL & GASIMPORTINGCOUNTRIES


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Inefficienciesand wastefulconsumer

behaviour


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We have plenty of sunshine

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More sunshine means lower Levelised Cost of Electricity (LCOE)

LCOE

Technology A

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900 1200 1800 2500 Yield/Insolation

Technology B


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How much exactly – best to measure locally

• Satellite-based data vs.measurement on the ground

• Dust

• Aerosols in atmosphere

• Temperature

• Data history

• Measurement frequency

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Regional monitoring station at the Masdar Institute

Yield measurement at a site


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MENA

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•Plenty of Demand for Power•Plenty of Oil & Gas

•Plenty of Renewable Energy Resources

•Plenty of Carbon Emissions


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Target markets for MENA solar

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Source: ‘Sunrise in the Desert – Solar becomes commercially viable in MENA’ –Emirates Solar Industry Association White Paper by Robin Mills, January 2012, Copyright 2012. All rights reserved


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Complements – not Substitutes

CC ‘cheap’ Gas

CC LNG

OC LNG

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Source: ‘Sunrise in the Desert – Solar becomes commercially viable in MENA’Emirates Solar Industry Association White Paper by Robin Mills, January 2012Copyright 2012. All rights reserved

Generation mix with/without solar power (July)

CC ‘cheapest’ Gas


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Complements – not Substitutes

CC ‘cheap’ Gas

CC LNG

OC LNGSolar PV

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Source: ‘Sunrise in the Desert – Solar becomes commercially viable in MENA’Emirates Solar Industry Association White Paper by Robin Mills, January 2012Copyright 2012. All rights reserved

Generation mix with/without solar power (July)

CC ‘cheapest’ Gas


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Renewables OR Nuclear Energy?

PV CSP Wind

VS.

Nuclear

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Solar PV OR Solar CSP OR Wind?

CSP Wind

VS.

PV

VS.

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...Renewables OR AND Other Energy Sources

Oil & GasNuclear

+

PV CSP Wind

+ ++

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Complements – not Substitutes (for now...)


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A low(er)-carbon Energy Mix

Jordan 2020: 10%Dubai 2030:5%

Kuwait 2020:10%

RE

Abu Dhabi 2020 :7%KSA 2032: 16-22%

Egypt 2020: 20%

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Oil & GasNuclear

+

PV CSP Wind

+ ++

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Oil & GasNuclear

PV CSP Wind

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Trade


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Supply Efficiency and Renewable shares riseas grids become larger and smarter

UAEKSA

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GCC Interconnection EU-MENA Grid Integration


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Larger and Smarter Grids connect demand and supplyacross national and international borders

•

• LESS storage requirements for RE

• MORE harvesting of Renewable Sources for local power demand

• MORE export revenues from freed-up oil & gas

• MORE export revenues from exported electricity

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• MORE economic diversification in new generation and transmission


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UAE Solar Survey 2012October 2012

• Initiative by ESIA and PwC in collaboration withthe UAE Federal Government

• Over 100 survey respondents providedcommentary and insights over a period of 6 weeks.

• 76% were based in the UAE, the majority considered themselves to have either ‘expertknowledge’ or ‘good knowledge’ of the solarIndustry, both globally and in the UAE.

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• Most had 3-10 years’ experience in the GlobalSolar Industry. A significant number of

respondents were senior executive level.

• Representation from government, projectengineering and solar technology developers andIndustry Consultants.


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“What sectors will

drive furtherdevelopment of

”

“What are the issuesin funding and

financing solar

developments?”

“How quickly will the market develop?”

“What are thechallenges solar

in the UAE?

“Which Solartechnologies are

best suited for

“How can UAE nationals benefit

“What can thegovernment do todrive growth in thesolar industry?”

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“What is the best incentive system

to support thesolar industry?”

the UAE?” rom e currengrowth in renewable

energy?” “What are thechallenges forresearch and

developing humancapital?”


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Q8: Which applications do you think will drive further development of solarprojects in the UAE?

54

58

Installation onto existing solar rooftops

Integration of solar into new construction

13

14

38

41

46

47

Other*

Electric vehicles and their charging stations

Desalination

Replacement of gas for electricity generation

Replacement of diesel

Heating / cooling of industrial processes

Integration into new construction

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Example: Al Bateen School Abu Dhabi,

(Photo Courtesy of Environmena)


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Thank you

Hannes ReinischSenior Manager,Renewable Energy and Sustainability Advisory, PwC

ESIA Research and Policy Committee Member

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PwC Middle East Centre of Excellence for Renewable Energy, Cleantech and Sustainability Meet the Team

Hannes ReinischCOE CoordinatorSenior Manager, Renewable Energy andSustainable Development

Paul NavratilLead Partner for Energy - Middle [email protected]

Saudi Arabia

Oman

UAE

Q

atar

Kuwait

Jordan

Egypt

. . .

Jakub Zielkiewicz

Dr. Anil KhuranaPartner, PwC’s PRTM Management [email protected]

Mohammed SalemPartner, Climate Change and Sustainability [email protected]

Maarten WolfsDirector, Finance & [email protected]

Nathan CluteDirector Clean technolo

Bernhard HaiderPartner – Power & UtilitiesSmart Grid and Renewable Energy

[email protected]

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anager, ma e ange an ar on [email protected]

Gus SchellekensDirector, Renewable Energy Expert

[email protected]

Emily Manuel Assistant Manager, Renewables & Power

[email protected]

investment & deployment [email protected]

Andrew Thurley Director, Director - Public SectorSustainability

[email protected]

Tania Abu ZeidConsultant, COE [email protected]

Global Members of ME COE


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About ESIAThe Emirates Solar Industry Association (ESIA) is a non-profit, non-governmental organization that brings together the region’s solar industry. Our goal is totransform the Middle East’s vast solar potential into a commercially and environmentally viable solution for the region’s growing electricity demand.

ESIA provides its members with services such as educational workshops, networking functions and special reports on breakthrough solar innovations. We alsoprovide assistance to international companies seeking to expand their solar operations in the Middle East. The association is currently working on initiatives thatbring together leaders from the policy sector, academia, and the private sector. The monthly ESIA newsletter goes out to over 1,200 readers in the Middle Eastrenewable energy space – the largest of its kind.

About The Author Robin Mills is the Head of Consulting at Manaar, the Dubai-based energy consultancy providing business advice and operations management consulting servicesfor private and government energy companies in the Middle East. Until October 2011, he was the Petroleum Economics Manager at Emirates National OilCompany. From 2006-2008, he was Senior Evaluation Manager at Dubai Energy and before that, had a variety of economic and geological roles during his eightyears with Shell. Robin has published two books, "The Myth of the Oil Crisis: Overcoming the Challenges of Depletion, Geopolitics and Global Warming" (Praeger Publishers, 2008) and “Capturing Carbon” (Columbia, 2011), and features widely in MENA and international media on energy and environmental issues. He holdsan MS in Geological Sciences from Cambridge University.

About PwCPwC firms help organisations and individuals create the value they’re looking for. We’re a network of firms in 158 countries with close to 169,000 people who arecommitted to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com.

Established in the Middle East for 40 years, there are PwC firms in Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Oman, the Palestinian territories, Qatar,Saudi Arabia and the United Arab Emirates, with around 2,500 people. (www.pwc.com/middle-east) © 2012 PricewaterhouseCoopers. All rights reserved.

"PwC" is the brand under which member firms of PricewaterhouseCoopers International Limited (PwCIL) operate and provide services. Together, these firms formthe PwC network. Each firm in the network is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does not provide anyservices to clients. PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional

judgment or bind them in any way.

s pu ca on as een prepare or genera gu ance on ma ers o n eres ony, an oes no cons u e pro ess ona a v ce. ou s ou no ac upon einformation contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to theaccuracy or completeness of the information contained in this publication, and, to the extent permitted by law, the authors and distributors do not accept or assumeany liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this

publication or for any decision based on it.

Copyright 2012. All rights reserved.

“PwC” refers to the network of member firms of PricewaterhouseCoopers International Limited (PwCIL), or, as the context requires, individual member firms of thePwC network. Each member firm is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does not provide any services toclients. PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or bindthem in any way. No member firm is responsible or liable for the acts or omissions of any other member firm nor can it control the exercise of another member firm’s professional judgment or bind another member firm or PwCIL in any way.

"ESIA" refers to the Emirates Solar Industry Association, non-profit industry group based in the UAE.

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14.00 Hannes Reinisch Renewable Energy Sustainable Dewelopment PwC