Trade Arabia reported that the demand for electricity in the GCC will grow at a rate of 7% per year over the next 20 years which can be met by improved interconnections and migration to renewable sources.
According to A T Kearney a global management consultancy, the GCC power requirements measure up against a global demand growth rate of 1.8% per year. For every megawatt hour of power not supplied to key industries in the Gulf Cooperation Council approximately USD 700,000 is lost in revenue with a corresponding drop in GDP.
While peak electricity demand in the GCC increased by more than 60% between 2003 and 2009 GCC countries face the challenge of planning immediate capacity increases as well as building sustainable power sources to meet soaring power needs.
The study said that developing renewable power sources, grid expansion across neighboring countries, unbundling processes and regulatory schemes will improve power generation capacity.
Electricity generation in the GCC which is predominantly oil and gas based is straining fossil fuel reserves, shortening their duration and contributing to an already high CO2 footprint. In addition, using oil or gas as the primary source for domestic electricity consumption manifests a lost opportunity in monetizing the export of oil and gas and their derivatives.
Mr Louis Besland partner at A T Kearney Middle East said that “Adding new conventional capacity is the typical approach. However, given consumption of fossil resources in power generation is not economically sustainable this is not a long term solution.”
According to the A T Kearney study, inconsistent distribution is affecting the region’s ability to meet rising demand for electricity. While there is no shortage of power on an aggregate level in the region at a granular level pockets of over capacity currently exist.
This is the case in Saudi Arabia and within parts of the UAE such as Abu Dhabi and Dubai, while Sharjah suffers from electricity shortages. Kuwait, Oman and Bahrain all experience power shortages at times of peak demand. Qatar has solved the problem by building additional combined cycle gas turbine capacity in an impressively short period of time.
Mr José A Alberich partner at A T Kearney Middle East said that “The imbalances will be solved with interconnection capacity developments. Grid interconnection improves reliability, reserves pooling, load factors and modulation capacity through interconnecting systems that have different load profiles and generation mixes.”
He said that “Improving interconnection across borders brings transparency in the contracting and use of the capacity available and yields additional benefits from harmonizing technical procedures and balancing regimes.”
Given the GCC region has an obvious solar energy capacity advantage over western countries, A T Kearney expects that solar energy will increasingly become part of the regional energy mix, enabling the region to fulfill the soaring power needs needed to fuel economic development and private household demand.
Mr Alberich said that faster migration and expanding renewable sources of generation capacity needed in the years ahead can contribute significantly to solving the problem of scarcity of natural gas and improve the carbon footprint. Governments and companies in other countries have already made the investment to bring solar technologies to an industrial level with utility scale installations and the GCC countries can benefit from this.
(Sourced from Trade Arabia)
