Doha Bank's Group CEO addresses the renewable energy development in GCC at the World Energy Forum held in Dubai
- Qatar: Tuesday, October 30 - 2012 at 12:12
- PRESS RELEASE
"Global warming and the expected depletion of conventional energy sources such as oil and gas are pushing GCC countries to pursue alternate energy sources," said Dr R. Seetharaman, Group CEO of Doha Bank, the leading private commercial bank in Qatar. He was speaking at a panel discussion on the concluding day of the World Energy Forum held in Dubai. An avid environmentalist, Dr Seetharaman addressed the forum on the Changing Dynamics of the Gulf States towards Green Mission.
He said: "Considering that 30% of all Green House Gas (GHG) emissions and 60% of fossil fuel-related emissions are from the use of oil and gas, with a further 5% added due to the exploration, production, processing/refining and transportation of these fuels, only 10% of companies in high impact sectors such as oil & gas have adopted a good or advanced response to climate change risk. While the UK, European Union and the US have now developing mandatory requirements to be complied with, in relation to carbon trading/greenhouse emissions, many GCC member countries have proposed a minimum target of 5% energy procurement from renewable energy sources by 2020. In line with this, projects are now underway with more than 9000 MW either under construction or in planning stages - dominated by solar and wind energy."
Dr Seetharaman stressed the importance of public policies within the GCC to expand or constrain renewable energy development over the coming decades.
He said: "Close to 80% of the world's energy supply could be met by renewable sources by mid-century if backed by the right enabling public policies."
Comparing the contribution of the major sources of renewable energy, Dr Seetharaman said "Bioenergy,used mainly for traditional cooking and heating in developing countries, currently represents over 10% of global energy supply. Direct solar energy, contributes only a fraction of 1%, Geothermal energy(based on heat extraction from the Earth's interior) represents less than 1%, hydropower contributed 16% and wind energy met close to 2% of total global energy supply."
Focusing on the climate change impact in the GCC, Dr Seetharaman said: "The rising sea levels will affect coastlines and marine life severely and could impact the efficiency of desalination plants that are the only source of water in the GCC region. Secondly, rising temperatures translates into increasing water demand and, with falling freshwater levels and increasing salinity in sea water, water scarcity is a fearsome prospect."
Talking about the significant developments in GCC's hydro power sector, Dr Seetharaman said: "GCC states would invest close to $100bn for infrastructure development and explore new ways to ensure uninterrupted supply of drinking water to its residents in the next five years. Considering that the region does not have natural sources of fresh water supply, the member states have to bear huge costs in the desalination of water. Also, electricity consumption has doubled globally since 1980 and at the prevailing rate, there is every reason to believe the consumption would double from the present levels by 2030. Electricity consumption could grow at even higher rates in countries such as Qatar."
Emphasizing the possibilities of solar and wind energy as potential sources of renewable energy in the GCC, Dr Seetharaman said: "GCC countries have enough solar and wind potential to generate electricity that could meet all their needs without using the oil and gas wealth.If the GCC countries allocate 0.5% of their 2.5 million square km area for the generation of electricity from solar energy and assuming their equipment have a conversion rate of 20%, they can generate enough energy for the year. Further, as for wind energy, the average wind velocity in the Gulf is around seven meters per second at 80 meters high. This speed is very suitable to operate windmills economically. As a result, a windmill with a 10 metre diameter and 35% efficiency rate can produce around 24 kw of electricity in the region."
Mentioning the significant developments in Qatar's renewable energy, Dr Seetharaman also highlighted the developments in Qatar towards renewable energy: "Qatar - the host nation of the 2022 FIFA World Cup - has proposed to develop and implement artificial cloud technology as a way of cooling off stadiums from the desert country's scorching summer.This project is being supported by collaboration between Qatar University and Qatar's Science and Technology Park (QSTP). It is expected that by 2017, the revamped Khalifa Stadium will be carbon-neutral, powered and climate controlled entirely by solar energy, serving as a precedent for Qatar's 2022 World Cup event infrastructure.Qatar-based Green Gulf is also working on installing solar panels in at least four schools in the country in an initiative labelled as 'Solar Schools'. Chevron has launchedthe Centre for Sustainable Energy Efficiency (CSEE) at Qatar Science & Technology Park as a part of research on latest energy efficiency and solar technologies.In April 2011, the U.S Department of Energy (DOE) and the Qatar Science & Technology Park (QSTP) have signed a MOU for clean energy technologies.Solar parking project will be established at the upcoming Solar Test Facility, a Chevron Qatar-Green Gulf initiative at Qatar Science & Technology Park. Solar parking is a simple and cost-effective way of utilising solar energy.In May 2012, Qatar Solar Technologies (QSTec) has signed an agreement with the Qatar Electricity & Water Company (QEWC) to explore the possibilities of developing power generation using solar energy in Qatar."
The panel further discussed the challenge of financing energy projects due to identifying and accessing sufficient funding for costly projects; structuring funding that repays investors sufficiently for risk that reflects the demand curve for the commodity, the local currency, and developer-specific risk while allowing profit potential for the sponsor; and allocating risk / reward incentives intelligently so that any tradable equity or bonds maintain fundamental value in the secondary market.
Also speaking on the panel were Mr Ray Wood, Managing Director and Head of Power and Renewables at Bank of America Merrill Lynch; Mr Jonathan Robinson, Managing Director and Head of Project Finance at HSBC Global Banking; and Mr Jamal Saghir, Director of Sustainable Development, African Region, World Bank.
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