The pressing need for investment in Abu Dhabi’s power and water infrastructure was the central message on the first day of the Abu Dhabi conference.
According to estimates used by the Urban Planning Council (UPC) in its Vision 2030 masterplan, Abu Dhabi’s population is expected to increase from 930,000 in 2007 to 2 million in 2020, and 3.1 million by 2030.
In line with this growth, the Abu Dhabi Water & Electricity Company (Adwec) forecasts that peak electricity demand in the emirate will rise to almost 23,554MW by 2030, from 5,830MW this year, a staggering 300 per cent increase in demand. Peak water demand will soar from 685 million gallons a day (g/d) to 1.2 billion g/d by 2030.
To meet this surge in demand, the Abu Dhabi Water & Electricity Authority (Adwea) has drawn up plans to virtually double the capacity of desalination plants in the emirate over the next five years.
As well as building more power plants, energy efficiency and education have risen to the top of the agenda for policymakers and energy companies.
“Education is crucial,” said Nick Carter, director general of the Regulation & Supervision Bureau, addressing the conference’s power and water session. “People need to be taught the value of the resource, whether it is electricity or water. We need to teach them how and why it is important to conserve it.”
Erik Jankel, chief executive officer of Norway’s Aqualyng, agreed. “Price is generally the go-to solution if you want to do something quickly [about the rising demand for water and electricity],” he said. “But if you are looking at effecting the curve over the long run, and not necessarily having to install all that capacity – three, five, seven years out in the future – then you need to educate and apply a softer approach.”
Finance is increasingly an issue as a result of the current global financial downturn. Adwea has revealed it is considering equity and bridge loans as a short-term measure to bridge the finance gap for its Shuweihat 2 project.
“This is a challenge for us,” Abdulla Saif al-Nuaimi, director of privatisation at Adwea, told the conference. “We think things will settle within a year or two, and when that happens, we will plan on refinancing Shuweihat 2.”
“If you’re looking to finance a project that is going to close in the first quarter of next year, I think you have got a sporting chance,” said Ranald Spiers, executive director at International Power. “But this year there is not a chance.”
Addressing feedstock issues, Al-Nuaimi confirmed that gas is the fuel of choice for all of Adwea’s new power plants.
Currently, more than 90 per cent of electricity generation in Abu Dhabi is from gas. However, as supplies become tighter, the emirate will consider other clean fuels, such as solar power. “For the time being, gas is our first option because we are facing a challenge to double our capacity within the stipulated period, in line with the Abu Dhabi Plan 2030,” said Al-Nuaimi. “But it does not mean we are not considering other renewable options.”
Nuclear power is also on the agenda. Maurizio La Noce, executive director of the energy and industry unit at Abu Dhabi government-owned Mubadala Development Company, said the UAE could have a nuclear power plant by 2020. He added that a lot of research has already been done into nuclear energy in the UAE, details of which will soon be made public.
Nick Carter, director-general, Regulation & Supervision Bureau
Daniel Dexter, group vice-president, global power, Abu Dhabi National Energy Company
Erik Jankel, chief executive officer, Aqualyng
Maurizio La Noce, executive director for energy and industry, Mudabala
Ranald Spiers, executive director, Middle East & Asia, International Power
Rising demand: Abu Dhabi’s electricity infrastructure is in need of investment