Submitted with notes final group presentation 20112014

Editor's Notes

• #3: f
• #4: Solar is a radiant energy that produced by the sun harnessed by different technologies. Most popular are photovoltaic (PV) and Concentrated Solar power (CSP) which is Solar Thermal. In brief how these technology works, PV cells convert sunlight directly to electricity, Due to the impact of photons from sunlight on semiconductor material result a movement of negative electrons along with positive holes generating an electric current known as the photovoltaic effect. Second technology is the concentrated Solar Power (CSP) that use mirrors or lenses to concentrate a large area of sunlight onto a small area. Electrical power produced when the concentrated light converted to heat, which drives a heat engine (usually a steam turbine) connected to an electrical power generator.   Type of Solar Systems: Off- Grid is standalone system using batteries to store extra power generated in the day to be utilized at night On-Grid is connected to utility Grid and governed by the local regulation.
• #5: What are the global drivers towards solar energy? Energy Security: Countries are looking for new sources of energy to satisfy their future demands; Energy diversification is key strategy for exporting countries to decrease their reliance on Fossil fuel and for importers to minimize the political risks and price manipulation of the same. Increase of Energy Demand because of Population Growth, also developing countries required more energy to satisfy their progression. Costs of Fossil Fuel is increasing because the depletion of oil and gas increase the cost of extraction In reference to the graph, Cost of Solar technology is declining nearly 60 percent since 2009 and forecasted to keep declining by average of 5% per year until the end of the decade. Environmental Concerns: Global warming awareness and governments initiative to decrease CO2 emission per capita Creation of Jobs: Solar will create new industry of manufacturers, distributers, installers that is attractive for Governments to develop their economy.
• #6: Slide 3: How can these drivers change and become more or less important?   Energy security concerns: expected to increase in the future, Government needs to find alternative energy sources because of the depletion of Fossil fuel. Energy demand: expected to increase over time due to increase in population, immigrations from countryside to cities, more access to electricity, more manufacturing activities & infrastructure expansion. Jobs: availability will always stay one of the major concerns. Cost of solar energy: it is falling & expected to keep falling in the future. Cost of conventional energy: expected to increase as exploration cost increasing due to extracting difficulties. Environment: there is high environmental concerns currently due to global warming. These concerns expected to decline because of people awareness and the increases usage of renewable energy in the future. Fracking as a game changer: Developing new technologies such as fracking might be the game changer for new solar investments as it has a direct impact on the discussed drivers.   Energy security: are expected to improve, so less concern due to access for new bulk of energy reserves (USA to cut their oil imports by 44% in 2014) (President Obama said in statement in Oct. 2014; the goal we set to cut oil imports by half in 2020 will meet this year). Cost of solar energy: expected to decrease but relatively less than the current forecasts, Cheap access to fuel from Fracking will reduce the investments in solar. Cost of conventional energy: expected to have massive drop to become more cost efficient than solar energy. (fracking cause drop in gas prices from $9 in 2005 to $2.75 in 2012 while oil prices dropped from $104 in Aug 2014 to below $75 within 3 months) Environmental concerns: will increase due to fracking harm on environment & the expected huge investments in fracking. (Europarometer survey in 2013 shows 70% of European sees renewable as priority for the next 30 years & are against fracking technology due to potential pollution in water reserves)
• #7: Cost of solar system is declining continuously due to the boom in manufacturing solar PV in China, achieving high supply & economy of scale according to (IRENA 2014). Solar to replace part of nuclear, coal & fossil fuel sources. Japan & Germany as an example planning to replace part of their nuclear capacity by solar energy and many other countries expected to follow. Global governments will triple subsidy for renewable energy by 2035. According to the “IEA's World Energy Outlook 2012” government subsidies on renewable energy are expected to reach $240 Billion by 2035 compared to $88 Billion in 2011 New development in solar technology to increase efficiency, reduce size, cut cost & increase the applications. Fortune 100 companies investment in solar, for example Google is an active investor in renewable projects with $1 Billion investment since 2010. Wall mart plans to run with 100% capacity from renewables by 2020.
• #8: If we look at the top 6 countries in the solar industry: Germany is the world leader and managed to maintain their No. 1 position in 2014 with 30% CAGR growth over 2010 China has made a major commitment to solar power and managed to grow from 8th position in 2010 to the 2nd position with 127% CAGR growth. While all markets scaled back their incentives, china increased their targets and backed programs to boost market demand Italy as well is doing a great job and to over Japans position to become the 3rd biggest market in solar energy in 2014 with 71% CAGR growth, Italy on per capita bases is the 2nd biggest player in the industry Japan fell from the 3rd place in 2010 to 4th in 2014 but still they managed to grow by around 39% CAGR and have its dedication to solar power and become more innovative in their approach for example; Soon they will be launching the floating solar farms off the nation cost Spain is the only market that dropped significantly from the 2nd player to the 6th player with only 10% CAGR due to several reasons which will discussed later
• #9: One of the key success factor across the leading market is that they applied number of policies to encourage solar growth, these policies as listed are the: Feed in tariff (FITs): Offer providers of Energy (Consumers) a fixed but attractive price for recovery of generation cost Quotas: the government sets a percentage of electricity to be generated by renewable sources, assigns an actor, such as electricity users, suppliers or generators, to meet the specific percentage and penalizes those who fail to meet their goals. Bidding tenders: the policy mechanism works by calling for bids from investors for RE projects. was first started by UK in the form of Non Fossil Fuel Obligation (NFFO) in 1990. Tax credits: They are largely used in Europe, USA, Japan, and India. Investment Tax Credits can cover the cost of the RE system itself, or even the total cost of the installation. Net metering:energy generated by that electric consumer from an eligible on-site generating facility and delivered to the local distribution facilities may be used to offset electric energy provided by the electric utility to the electric consumer during the applicable billing period
• #10: Successful countries had strong drivers that triggered the need for an alternative source of energy, they managed to set targets for themselves and as mentioned they applied number of policies to encourage solar growth
• #12: So now what is the position in the UAE from a solar energy perspective? We will discuss the position of the UAE from the following perspectives: regulatory/political, environment, infrastructure, growth and culture.
• #13: Fadi Points: UAE has 7 emirates and a clear unified political decision by all emirates seems to be slightly lacking behind on Solar projects with some communication with the capital Abu Dhabi where all the political power is. The electricity and water bills are heavily subsidized by the Abu Dhabi government making solar energy a high cost investment. A clear policy in terms of setting the target for the applied quota for solar energy has been set by the two major emirates: Abu Dhabi at Targets 7% and Dubai 5% by 2030. Being one of the highest CO2 emitting countries in the word UAE has set out a target of 7% reduction in CO2 emissions by 2020. All that said the UAE still is lacking the mechanism and regulatory frameworks to mandate, monitor and audit activities within the various emirates to achieve these targets
• #14: Moving on to the Environment position in the UAE. Point # 1: : JIM KRANE ,2014) The electricity consumption in the UAE was a big factor in the country’s ranking as the world’s No. 6 per-capita emitter of carbon dioxide from fuel combustion .The following charts illustrate the magnitude of the UAE’s growth in electricity generation and carbon dioxide emissions by comparison with Switzerland, a rich country with a similar population size. We can clearly see how the UAE increase in the CO2 emissions is incomparable to Switzerland. Point # 2 & 3: With regards to the second point: despite sitting on the world’s 4th largest natural gas reserves, the UAE is finding it hard to get the stuff out of the ground fast enough. As we can see from the graph the UAE gas production has already exceed its consumption 5 years back placing a strain on the UAE forcing it to import gas from Qatar. In addition to the situation with gas the Oil reserves and fields yet to be explored have reached a maximum putting more pressure on the UAE. The UAE is currently second worldwide in terms of the rate of depletion of its main energy generation resources. Point # 4: :Solar Radiation: it falls in favor of the UAE. Solar Radiation is measured by the number of hours in the day during which the sunshine is above a certain level Annual mean global radiation for UAE is number 6 in the world wide which makes the UAE an ideal position for an efficient solar energy generation with an average annual solar hours of 9.7 h/day  which when compared to other countries discussed previously – it actually is in the range of 25% to 100% more. Point # 5: : Dusty Environment UAE has a dusty weather during various times in the year. “If a dust storm hits you can lose 50%of the performance of the solar panels in just two hours, And that will stay at 50 per cent until you clean it. Based on a research conducted on the modeling of Dust effect on solar panels in UAE it is estimated that a cleaning process should take place on a regular basis every 10 to 15 days on average to keep the performance as high as 90% under normal conditions. Regular solar panel cleaning is highly recommended if not required.
• #15: Moving on to What is the infrastructure Position in the UAE? Point #1: Dubai and Abu Dhabi’s power grids were connected in mid-2006, allowing the two emirates to share energy resources. In 2007 SEWA was connected and 2008 FEWA joined. Point #2: There are a number of solar energy projects ongoing in the UAE with various magnitudes. The grid-connected solar Completed projects in operation in UAE currently are (Shams-1” in Abu Dhabi , NOUR 1 Dubai) Point #3 ON the other hand the constraints related to the infrastructure in UAE are within three main categories: market technology, policy, and cost. These constraints could have an affect against the infrastructure position integration with solar energy as follows: With regards to Market Technology: There is a lack of commercial skills, information available and insufficient supply of the technology through local sources to support the potential solar infrastructure. Add to that the potential solar technology potential performance uncertainty and its affect on the operation of the grid is an element of concern. With regards to Policy: There is an absence of a clear legal and policy framework to support such an infrastructure. With regards to the cost: There is a high initial capital costs of integrating the infrastructure for consumer use , plus other : External costs such as Water & labor costs (potentially robots) to clean Solar Plants during dusty weather conditions
• #16: What are the culture factors and position of the UAE and their implications on solar energy solutions adoption? Point # 1: The UAE is divided into 7 emirates each one has a family ruling group which are aligned on the unity of the country however with each focusing on the value he can bring to his own emirate first. Point # 2: The adoption of the solar energy will only take place in the UAE when the leader/government tell the people what needs to be done. Point # 3: Citizens Maintain rigid codes of belief and behaviour and maybe intolerant of unconventional ideas such as solar energy. Point # 4: Security is an important element in individual motivation Implications on Solar energy: The people living in the UAE have high per capita energy consumption, it will be difficult to change there consumption habit and reduce it if needed with the adoption of solar energy. It will take time to convince them to adopt an unconventional source of energy A lot of effort will be needed to get them to must understand the issues rotating around the current source of energies and the need to adopt new technologies to secure future energy supplies.
• #17: Now looking at the forecasted growth in the energy demands we can see that: Point # 1: The UAE economy has enjoyed one of the fastest growth rates in the world over the past 10 years. This growth had direct impacts on the energy consumption where electricity demand grew at a Compound Annual Growth Rate of more than 7.5% over the past 10 years as shown in the table below which is above the average of the GCC. Note that On a per capita basis, UAE residents consume more electricity than almost anyone else on the planet (to give you a comparison it is more than triple the average American home’s consumption). According to official government forecasts, demand is expected to continue growing by over 10% until at least 2019.   Point # 2: (JIM KRANE ,2014) As Figure 4 shows, if UAE utilities continue consuming natural gas at the present rate, the UAE Gas consumption for the electricity sector alone would require the equivalent of 93% of the UAE’s Total Natural production by 2020. This massive growth in demand is fueled by rapid growth in the industrial sector, residential and commercial megaprojects and upcoming events like the expo 2020   Point # 3: For the  Expo 2020: Dubai government set a budget of $7 billion to invest in Dubai infrastructure related projects from now till to be ready for the expo 2020 and they are expecting private investors to contribute with another $30 billion to revive the construction, industrial & commercial sectors. This will will cause a rapid growth requirement in the energy consumption that will need attention.
• #18: Why solar energy might be attractive to the UAE? It will be attractive for the following reasons: read the slide. What could change this? Oil Prices: Global fracking will have direct impact on oil price (decrease) due to the massive increase in oil supply. UAE investments & spending are financed mainly by oil revenue. One of the main drivers for global energy demand is the annual GDP. In 2012 oil industry contributed 32.7% of UAE GDP. USA as the largest oil importer managed to cut their oil imports by 44% in 2014 causing the global oil demand to drop & thus the prices, this will harm the UAE’s annual GDP & may result in budget deficit therefore the ability to finance the huge investments such as solar energy projects. Geopolitical Reasons: Arab spring creates instability within the region & causes many investments to stop as investors worry about the future of the region. As a result the government of UAE will potentially increase their spending on security and defense related projects to ensure its stability and protection against rising groups such as ISIS forces, this will result in a change of priorities in the spending moving them potentially away from solar energy projects. As per some analysts the potential exit of the US army from the region in the long run could also have a negative effect on the local political stability of the region and thus diverting investments away from things like solar energy making it less attractive to the UAE.
• #19: At what stage is the UAE government within the roadmap for the adoption and release of the Solar Energy policy?
• #20: Moving now to our Primary research part that focused on highlighting the readiness of the UAE consumer market to adopt solar energy grid connected solutions. We conducted a survey that was emailed out using Survey Monkey and was answered by 130 candidates. The questionnaire was sent to communities, work environments and business school UAE students which predominantly were living in Dubai. I will now highlight a few important sample of the results: When asked: Are you paying a high electricity bill? Over 50% believe they are paying a high electricity bill even though the electricity sector is heavily subsidized. 2. When asked: Are you aware of solar energy and what do you know about its uses? 66% of the consumers believe solar energy can be used effectively if designed well and around 24% perceive it to be expensive. 3. When asked: Are you willing to invest in a solution that would reduce your cost of electricity? Over 75% are willing to invest in a solution to reduce the costs of their electricity bill. Showing a high interest in such solutions 4. When asked: Are you aware that solar energy solution can offer you major reductions in your consumptions of electricity? Only 35% said yes and while 65% expressed no awareness about the use of solar energy within the area of reduction of electricity. Taking this a step deeper to investigate 5. When asked: Would cost be considered the first decisive factor when considering solar energy grid solutions? 72% said that cost is the decisive factor when considering solar energy and in the next question when a financial figure was attached to explore how much were consumers willing to pay -CLICK NEXT-56% were willing to pay for it while 44% said they are not interested. In Summary our Findings are: 1. UAE Consumers have Good Awareness of Solar Energy 2. Cost is the decisive element for investment and is a barrier to most UAE consumers to move forward. 3. UAE consumer awareness of the Linkage of Solar energy and its use in the reduction of electricity is relatively low. ************************************************************************************************************************************************************************************
• #21:   Primary Research Results: Interviews We executed three interviews with key officials 1- Dr. Rabia Ferroukhi - IRENA 2- Mr. Assem Khalaili : General Manager at Siemens Industry 3-   The objective of the interview was to understand what is delaying UAE from engaging the public to adopt solar Energy. Our Results was as follows: Solar is disruptive technology for the energy sector in UAE causing resistance from the current stakeholders Cheap access to oil offer Gov time advantage to study carefully holistic approach and consider other aspects related to health, jobs, energy security. Fracking will drop the price of oil that will affect GDP negatively and may stop Government support toward Solar. Political reasons is also behind the fast drop of oil recently, USA & EU against Russia, as some analysts said Russia will have deficit in their budget if oil price fall to $75 level.
• #22: Limitations of Primary Research Results Only 3 interviews Lack of Major government officials from other Emirates especially Abu Dhabi Only 130 Consumers Completed the Surveys Surveys  only filled by Dubai residents
• #23:   As a conclusion to the readiness of UAE Market we found the following:   There is no clear regulations yet. Environmental concerns from government side only not people. Infrastructure need improvement. Concern of change & lack of people power over government rules & regulations. There is a massive growth in energy demand & in energy diversification programs.
• #24: Obviously, political commitment to renewable energy is a MUST pre-condition for successful adoption of solar energy Here is our recommendation: Apply mixed policies: between feed in tariffs and quotas in order to motivate households in one hand and to enforce targets with in the industry in the other hand Solar farms for public investors: We advise government to take new direction of engaging households to generate power. We suggest that Government could utilize the empty desert by creating solar farms open for individual investors; household could invest in these farms to cover their own consumption and to sell back the extra power to the national grid. From economy of scale, it would be easier for Government to manage and maintain the plants and for the investor to avoid the hassle of the space needed and maintenance of the panels. Increase the eco awareness: government to increase the eco awareness among residence through educational campaigns. Reduce electricity subsidizing: then household bills will increase and they will consider alternatives. Privatization of power utilities to encourage competition in the industry Subsidy solar energy solutions to encourage investors