3 PAIRING COAL WITH SOLAR: THE UAE’S FRAGMENTED …
65
two pledges appeared aimed to transform global public perceptions of
the UAE from an autocratic petrostate that was an outsized producer,
exporter, consumer, and subsidizer of fossil fuels, to a progressive haven
for ambitious environmental goals.
The Masdar announcement came at a time when domestic production
of associated natural gas—that produced in tandem with oil—began to lag
growth in demand, and when oil prices were breaching new highs, driven
by new consumption in China. Abu Dhabi was receiving an enormous
windfall in oil profits while simultaneously grappling with a shortage of
its main power generation feedstock.
Clean energy exuberance in Abu Dhabi was short-lived. Masdar’s
ambitions were scaled back after the 2009 recession, and several projects
were cancelled or downsized. Among the victims was Masdar City itself,
which saw its zero-carbon promise dropped as too expensive. The city’s
size was reduced and completion date pushed back. Also shelved was a
400 MW hydrogen power plant that was to have been built jointly with
BP. 22 Construction and operating costs for concentrating solar power
plant Shams 1 (50 MW of solar augmented by 50 MW of gas-fired generation) were so high that LCOE for the plant was estimated at 40 US cents
per kilowatt-hour. 23 Two follow-on phases were cancelled.
The downsizing of Masdar, Shams, and Abu Dhabi’s renewables ambitions did not reduce the reputational benefits that the emirate would
accrue. In 2009, before virtually any of Abu Dhabi’s clean energy plans
had been realized, the emirate was selected for the prestigious opportunity
to host the headquarters of a new United Nations agency, the International Renewable Energy Agency. IRENA, as it is known, remains the
first and only UN agency with a permanent headquarters based in the
Middle East.
On the other hand, the UAE’s PV solar power ambitions turned out
to have been underestimated in 2009. As panel prices fell, utilities in
Dubai and Abu Dhabi secured ultra-low tariffs from developers—after
providing free land and grid connections—and came close to meeting
the 2020 renewables goal, in capacity terms at least. As 2020 arrived,
Abu Dhabi’s renewables installation had reached nearly 1 GW, 6% of its
installed capacity of 16.7 GW, and sufficient to provide about 2–4% of
the emirate’s electricity. Installed renewables capacity in the UAE overall
reached 2.1 GW by December 2019, equal to 7% of the country’s roughly
30 GW of installed capacity, but—given the lower capacity factor for
intermittent renewables versus thermal generation—producing 2–3% of
nationwide power. 24
65
two pledges appeared aimed to transform global public perceptions of
the UAE from an autocratic petrostate that was an outsized producer,
exporter, consumer, and subsidizer of fossil fuels, to a progressive haven
for ambitious environmental goals.
The Masdar announcement came at a time when domestic production
of associated natural gas—that produced in tandem with oil—began to lag
growth in demand, and when oil prices were breaching new highs, driven
by new consumption in China. Abu Dhabi was receiving an enormous
windfall in oil profits while simultaneously grappling with a shortage of
its main power generation feedstock.
Clean energy exuberance in Abu Dhabi was short-lived. Masdar’s
ambitions were scaled back after the 2009 recession, and several projects
were cancelled or downsized. Among the victims was Masdar City itself,
which saw its zero-carbon promise dropped as too expensive. The city’s
size was reduced and completion date pushed back. Also shelved was a
400 MW hydrogen power plant that was to have been built jointly with
BP. 22 Construction and operating costs for concentrating solar power
plant Shams 1 (50 MW of solar augmented by 50 MW of gas-fired generation) were so high that LCOE for the plant was estimated at 40 US cents
per kilowatt-hour. 23 Two follow-on phases were cancelled.
The downsizing of Masdar, Shams, and Abu Dhabi’s renewables ambitions did not reduce the reputational benefits that the emirate would
accrue. In 2009, before virtually any of Abu Dhabi’s clean energy plans
had been realized, the emirate was selected for the prestigious opportunity
to host the headquarters of a new United Nations agency, the International Renewable Energy Agency. IRENA, as it is known, remains the
first and only UN agency with a permanent headquarters based in the
Middle East.
On the other hand, the UAE’s PV solar power ambitions turned out
to have been underestimated in 2009. As panel prices fell, utilities in
Dubai and Abu Dhabi secured ultra-low tariffs from developers—after
providing free land and grid connections—and came close to meeting
the 2020 renewables goal, in capacity terms at least. As 2020 arrived,
Abu Dhabi’s renewables installation had reached nearly 1 GW, 6% of its
installed capacity of 16.7 GW, and sufficient to provide about 2–4% of
the emirate’s electricity. Installed renewables capacity in the UAE overall
reached 2.1 GW by December 2019, equal to 7% of the country’s roughly
30 GW of installed capacity, but—given the lower capacity factor for
intermittent renewables versus thermal generation—producing 2–3% of
nationwide power. 24