Dubai is aiming for tariffs of less than 5 US cents per kilowatt-hour for the third phase of the Mohammed bin Rashid Al Maktoum Solar Park totalling 800 megawatts.
Saeed Al Tayer, the managing director of Dubai Electricity and Water Authority (Dewa), said in Dubai that the utility’s target for the upcoming tender should set lower prices than ever before.
“We expect better, and when I say better, it should be below 5 US cents,” he said.
This year, the UAE made headlines with what was at the time the world’s cheapest solar energy. A consortium led by Saudi Arabia’s Acwa Power and TSK of Spain won an award for the second phase of the solar park, totalling 200MW, at 5.84 US cents per kilowatt-hour.
“Right now this particular tariff has been established and it is the one that everyone is aiming to beat,” said Paddy Padmanathan, the chief executive of Acwa.
“We can expect a lower tariff than the 200MW.”
A tender that rendered a solar tariff of less than 5 cents would be one of the lowest rates in the world. While other countries such as the United States may offer solar tariffs of just under 4 cents, that is not the true cost of the electricity. The US continues to offer subsidies, or financial incentives, to help attract investors.
There are 21 companies in the running for the project, including Abu Dhabi’s Masdar and the previous winner, Acwa.
Dewa expects to announce the winning consortia in six months.
Renewables are expected to make up 7 per cent of Dubai’s energy mix in five years, increasing to 25 per cent in 2030 and 75 per cent in 2050.
The second phase of 200MW is expected to come online in 2017 and the third phase with 800MW is set to become operational by 2030.
The Mohammed bin Rashid Al Maktoum Solar Park was originally slated to generate 1,000MW of solar energy, but in January, Dewa announced that it would triple the project’s size to 3,000MW.
And just last month, the Dubai directives expanded the plant even more to 5,000MW by 2030, which will equal about Dh50 billion in investments.
Meanwhile, Mr Al Tayer said Dewa was reviewing its strategy to meet the “challenging targets” set by the Dubai Supreme Council.
One of those issues will be to address the solar rooftop dilemma for high-rises, for which Dewa plans to create a pilot test for PV (photovoltaic) coating.
“The main issue we have in Dubai is space,” Mr Al Tayer said, pointing to the lack of surface area on high-rise rooftops to generate the power required to meet the building’s needs.
Photovoltaic coating could be a solution.
The technology includes a type of coating that can generate electricity through glass, like solar windows. Mr Al Tayer said that the technology had a major problem earlier as it took away transparency and visibility from the windows. However, new technology is emerging to manage this issue.
“I’ve heard that there is new technology that has corrected this, and we will try to make a test pilot for Dewa,” Mr Al Tayer said, adding that it was important that the utility try any and all technology before allowing it on the market.