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Oil-rich Kuwait’s drive for alternative energy sources

by Soft2share.com

Plans by the tiny oil-rich Persian gulf state of Kuwait to reduce reliance on hydrocarbons to generate electricity and to instead develop alternative sources of energy is mirrored in many other countries across the Arab world. Of course the drive to utilise clean, green energy sources not only represents major challenges for governments but also huge commercial opportunities for businesses.


In the United Arab Emirates (UAE), for example, renewable energy company Masdar has helped to spearhead the green revolution both in the Middle East and also across the planet. Banks and other financial institutions have not been slow to react either, developing and offering companies an extensive range of trade services in the UAE and elsewhere to help maximise the economic potential of this fast-moving energy frontier.

Indeed, the UAE recently confirmed its commitment to the African continent with the opening of the ShaikhZayed Solar Power Plant in Mauritania, a 15-megawatt (MW) solar photovoltaic (PV) plant built at a cost of some $32 million and delivered by Masdar. The plant will provide the energy needs of around 10,000 homes and account for 10% of Mauritania’s energy capacity. It will also displace more than 21,000 tons of carbon dioxide every year.

Closer to home is Shams1, a $600 million concentrated solar power (CSP) plant located in the western desert of the UAE’s Abu Dhabi emirate. No project better demonstrates the rich solar potential of the Middle East and North Africa (MENA) region, where annual global radiation reaches an incredible 2,000 kilowatt hours (kWh) per square metre. The plant, which will produce enough energy to power 20,000 home, was designed and delivered by the the Shams Power Company, a joint venture involving Masdar (60%), France’s Total (20%) and Spain’s Abengoa Solar (20%).

Meanwhile, back in Kuwait, the country is stepping up efforts to develop alternative sources of energy despite its substantial oil reserves, says the Oxford Business Group (OBG), a well-respected global publishing, research and consultancy firm.

In mid-June, says the OBG, the government announced it was inviting bids for the construction of Shagaya, a renewable energy park, as part of its plan to generate 15% of its electricity through non-oil sources by 2030.

Hydrocarbons account for more than 90% of Kuwait’s GDP and around 80% of government revenue. Oil production stands at about 3 million barrels per day (bpd), with domestic consumption at around 476,000 bpd. Local demand for oil has increased over the past decade, jumping 67% between 2002 and 2012. Domestic use of the country’s oil is expected to continue to grow, with demand for power – which is generated largely by oil-burning plants – rising by 6-8% each year.

The OBG adds, “Today the most promising renewables project is the 100-sq-km Shagaya energy park, which is located west of Kuwait City and should have the capacity to generate 70 MW of energy once the first phase is completed in 2016. Solar thermal energy will account for 50 MW, while the balance will be generated by wind and photovoltaic sources, according to international media reports. The second and third phases are expected to have the capacity to generate an additional 930 MW and 1000 MW of power, respectively. The government expects the project to be completed by 2030.”

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