A Frenchman is credited with being the first to discover the photovoltaic effect that produces electricity from sunlight. The first solar panel was built in the US. But when Abu Dhabi decided to build the world’s largest individual solar power project, they looked east for help.
The country partnered with Chinese and Japanese companies to construct a facility, which opened this year, with a peak capacity of 1.18 gigawatts generated by 3.2 million solar panels. That’s because Asia, more than any other region on the planet, and China, more than any other nation, currently represent the future of solar energy, and are at the heart of the ensuing industrywide transformation from fossil fuels to renewable and nuclear energy.
Decarbonization is changing the face of energy and the world economy in more ways than most consumers — and even most executives — appreciate. Besides the transition from molecule to electron, as this move toward electrification suggests, it is also shifting the industry’s economic base from West to East and reconfiguring the hierarchy of companies and geographies that define energy.
Asia is the 800-pound gorilla in the energy story. First, its continued economic growth and rising standard of living will make its constituent nations pre-eminent energy consumers for the foreseeable future. A study by BP indicates that Asia, including China and India, will represent 43% of global energy demand by 2040, and through that year, the region will account for more than 50% of the growth in demand. In contrast, energy demand among the 36 nations in the OECD, which includes most big economies in the Americas and Europe, will be flat.
China’s sunny outlook
Second, places like China are already among the most important suppliers of non-fossil fuel-based energy and technology. By 2017, China owned 72% of the world’s solar photovoltaic module production; in comparison, the US has 1% and Europe 2%. Of the eight top producers, six are Asian. Not including hydropower, China has somewhere around one-third of the world’s installed renewable capacity; the EU has a little over a quarter; and the US accounts for 14%. China also leads in the generation of hydropower.
As the electrification of transportation advances and demand grows for renewable energy storage solutions, China looks likely to monopolize here, too. China produces at least two-thirds of the world’s production capacity for lithium-ion batteries, which are used in electric vehicles (EVs), mobile phones and laptop computers (some estimates put their share at closer to 70%), and it looks likely to hang on to that lead through at least 2028. And besides being the largest market for EVs, China also controls the bulk of production.
China is the third-largest miner of the primary raw material used to produce those batteries, lithium — often referred to as white petroleum because of its mounting economic importance. Chinese producers are also buying up lithium reserves in Chile, the world’s second-largest lithium miner (Australia takes the top spot).
A fundamental overhaul
Of course, climate change is forcing the energy industry to undergo an existential transformation that may eventually see the elimination of fossil fuels entirely. While most executives at oil companies will be dead or at least retired before that transition proceeds to what seems its inevitable end, the slowing of demand is already being felt.
By contrast, the demand for electricity seems insatiable. Electrification rates continue to rise across the globe, with Asia expected to be close to 100% coverage by 2030. Much of that growth in demand may be supplied by renewables and nuclear power rather than fossil fuel-generated power, although natural gas is expected to play a role for years to come. It also may be accomplished through a decentralization of generating capacity, such as recent rural electrification projects in places like Malawi and Bangladesh where farmers and villages use solar panels and small generators to provide their own electricity.
What’s the World Economic Forum doing about the transition to clean energy?
Moving to clean energy is key to combatting climate change, yet in the past five years, the energy transition has stagnated. Energy consumption and production contribute to two-thirds of global emissions, and 81% of the global energy system is still based on fossil fuels, the same percentage as 30 years ago.
Effective policies, private-sector action and public-private cooperation are needed to create a more inclusive, sustainable, affordable and secure global energy system.
Benchmarking progress is essential to a successful transition. The World Economic Forum’s Energy Transition Index, which ranks 115 economies on how well they balance energy security and access with environmental sustainability and affordability, shows that the biggest challenge facing energy transition is the lack of readiness among the world’s largest emitters, including US, China, India and Russia. The 10 countries that score the highest in terms of readiness account for only 2.6% of global annual emissions.
Yet despite the urgency of climate concerns and the rapidly falling cost of renewable energy, the speed at which this existential energy transition will happen is uncertain, as pre- and post-tax subsidies on fossil fuels remain in place, discouraging consumers to make the change to a more environmentally beneficial and frequently cheaper source of energy. The International Monetary Fund estimates post-tax subsidies on fossil fuels like coal and petroleum — a result of unpriced externalities, such as societal costs from air pollution and global warming — totalled $5.2 trillion in 2017.
Regardless of the speed of transformation, there’s no doubt it is already well underway. That’s why places like the United Arab Emirates (of which Abu Dhabi is the largest) are building solar power and nuclear facilities, despite being the world’s eighth-largest oil producer — and making the transition with Asian partners. They see the future.
The MENA region has $100 billion worth of clean energy projects currently in the pipeline, according to a report by Energy & Utilities.
The report estimates total investment in clean energy to exceed $300 bn by 2050 if the region’s utilities are to meet their ambitious targets.
Middle East Energy said that the sharp drop in the cost of solar and wind power technologies is driving clean energy, with the cost of installing photovoltaic (PV) solar and wind having fallen by 73 percent and 80 per cent respectively since 2010.
The commissioning of the world’s largest single-site photovoltaic (PV) solar plant in 2019, the 1.17GW Sweihan independent power project (IPP) in Abu Dhabi, is one of the milestones reached this year in the push for clean energy, the report noted.
Dubai also reached financial close for a $4.3 billion concentrated solar power (CSP) project, Noor Energy 1, which is the largest single-site power investment project in the world.
The report estimates that installed power generation capacity will be required to increase 35 percent by 2025 just to meet rising demand in the Middle East. Rapid population growth combined with ambitious industrial and economic expansion programmes is resulting in the growing need for power, as demand for electricity is expected to triple by 2050.
“Driven by well-designed auctions, favourable financing conditions and declining technology costs, renewables are being brought into the mainstream. Based on the renewables targets already in place, the region, led by the UAE, could save 354 million barrels of oil which is equivalent to a 23 per cent reduction, cut the power sector’s carbon dioxide emissions by 22 percent, and slash water withdrawal in the power sector by 17 percent by 2030,” Gareth Rapley, Group Director, Industrial, at Informa Markets said.
The report was published as a preview to an event in Dubai, The Middle East Energy 2020, which will be organised by Informa Markets in March 2020.
A globalised solar-powered future is wholly unrealistic – and our economy is the reason why is elaborated on by Alf Hornborg, Professor of Human Ecology at Lund University.
Over the past two centuries, millions of dedicated people – revolutionaries, activists, politicians, and theorists – have been unable to curb the disastrous and increasingly globalised trajectory of economic polarisation and ecological degradation. This is perhaps because we are utterly trapped in flawed ways of thinking about technology and economy – as the current discourse on climate change shows.
Rising greenhouse gas emissions are not just generating climate change. They are giving more and more of us climate anxiety. Doomsday scenarios are capturing the headlines at an accelerating rate. Scientists from all over the world tell us that emissions in ten years must be half of what they were ten years ago, or we face apocalypse. Schoolchildren like Greta Thunberg and activist movements like Extinction Rebellion are demanding that we panic. And rightly so. But what should we do to avoid disaster?
Most scientists, politicians, and business leaders tend to put their hope in technological progress. Regardless of ideology, there is a widespread expectation that new technologies will replace fossil fuels by harnessing renewable energy such as solar and wind. Many also trust that there will be technologies for removing carbon dioxide from the atmosphere and for “geoengineering” the Earth’s climate. The common denominator in these visions is the faith that we can save modern civilisation if we shift to new technologies. But “technology” is not a magic wand. It requires a lot of money, which means claims on labour and resources from other areas. We tend to forget this crucial fact.
I would argue that the way we take conventional “all-purpose” money for granted is the main reason why we have not understood how advanced technologies are dependent on the appropriation of labour and resources from elsewhere. In making it possible to exchange almost anything – human time, gadgets, ecosystems, whatever – for anything else on the market, people are constantly looking for the best deals, which ultimately means promoting the lowest wages and the cheapest resources in the global South.
It is the logic of money that has created the utterly unsustainable and growth-hungry global society that exists today. To get our globalised economy to respect natural limits, we must set limits to what can be exchanged. Unfortunately, it seems increasingly probable that we shall have to experience something closer to disaster – such as a semi-global harvest failure – before we are prepared to seriously question how money and markets are currently designed.
This article is part of Conversation Insights The Insights team generates long-form journalism derived from interdisciplinary research. The team is working with academics from different backgrounds who have been engaged in projects aimed at tackling societal and scientific challenges.
Take the ultimate issue we are facing: whether our modern, global, and growing economy can be powered by renewable energy. Among most champions of sustainability, such as advocates of a Green New Deal, there is an unshakeable conviction that the problem of climate change can be solved by engineers.
What generally divides ideological positions is not the faith in technology as such, but which technical solutions to choose, and whether they will require major political change. Those who remain sceptical to the promises of technology – such as advocates of radical downshifting or degrowth – tend to be marginalised from politics and the media. So far, any politician who seriously advocates degrowth is not likely to have a future in politics.
Mainstream optimism about technology is often referred to as ecomodernism. The Ecomodernist Manifesto, a concise statement of this approach published in 2015, asks us to embrace technological progress, which will give us “a good, or even great, Anthropocene”. It argues that the progress of technology has “decoupled” us from the natural world and should be allowed to continue to do so in order to allow the “rewilding” of nature. The growth of cities, industrial agriculture, and nuclear power, it claims, illustrate such decoupling. As if these phenomena did not have ecological footprints beyond their own boundaries.
Meanwhile, calls for a Green New Deal have been voiced for more than a decade, but in February 2019 it took the form of a resolution to the American House of Representatives. Central to its vision is a large-scale shift to renewable energy sources and massive investments in new infrastructure. This would enable further growth of the economy, it is argued.
So the general consensus seems to be that the problem of climate change is just a question of replacing one energy technology with another. But a historical view reveals that the very idea of technology is inextricably intertwined with capital accumulation, unequal exchange and the idea of all-purpose money. And as such, it is not as easy to redesign as we like to think. Shifting the main energy technology is not just a matter of replacing infrastructure – it means transforming the economic world order.
In the 19th century, the industrial revolution gave us the notion that technological progress is simply human ingenuity applied to nature, and that it has nothing to do with the structure of world society. This is the mirror image of the economists’ illusion, that growth has nothing to do with nature and so does not need to reckon with natural limits. Rather than seeing that both technology and economy span the nature-society divide, engineering is thought of as dealing only with nature and economics as dealing only with society.
The steam engine, for instance, is simply considered an ingenious invention for harnessing the chemical energy of coal. I am not denying that this is the case, but steam technology in early industrial Britain was also contingent on capital accumulated on global markets. The steam-driven factories in Manchester would never have been built without the triangular Atlantic trade in slaves, raw cotton, and cotton textiles. Steam technology was not just a matter of ingenious engineering applied to nature – like all complex technology, it was also crucially dependent on global relations of exchange.
This dependence of technology on global social relations is not just a matter of money. In quite a physical sense, the viability of the steam engine relied on the flows of human labour energy and other resources that had been invested in cotton fibre from South Carolina, in the US, coal from Wales and iron from Sweden. Modern technology, then, is a product of the metabolism of world society, not simply the result of uncovering “facts” of nature.
The illusion that we have suffered from since the industrial revolution is that technological change is simply a matter of engineering knowledge, regardless of the patterns of global material flows. This is particularly problematic in that it makes us blind to how such flows tend to be highly uneven.
This is not just true of the days of the British Empire. To this day, technologically advanced areas of the world are net importers of the resources that have been used as inputs in producing their technologies and other commodities, such as land, labour, materials, and energy. Technological progress and capital accumulation are two sides of the same coin. But the material asymmetries in world trade are invisible to mainstream economists, who focus exclusively on flows of money.
Ironically, this understanding of technology is not even recognised in Marxist theory, although it claims to be both materialist and committed to social justice. Marxist theory and politics tend toward what opponents refer to as a Promethean faith in technological progress. Its concern with justice focuses on the emancipation of the industrial worker, rather than on the global flows of resources that are embodied in the industrial machine.
This Marxist faith in the magic of technology occasionally takes extreme forms, as in the case of the biologist David Schwartzman, who does not hesitate to predict future human colonisation of the galaxy and Aaron Bastani, who anticipates mining asteroids. In his remarkable book Fully Automated Luxury Communism: A Manifesto, Bastani repeats a widespread claim about the cheapness of solar power that shows how deluded most of us are by the idea of technology.
Nature, he writes, “provides us with virtually free, limitless energy”. This was a frequently voiced conviction already in 1964, when the chemist Farrington Daniels proclaimed that the “most plentiful and cheapest energy is ours for the taking”. More than 50 years later, the dream persists.
Electricity globally represents about 19% of total energy use – the other major energy drains being transports and industry. In 2017, only 0.7% of global energy use derived from solar power and 1.9% from wind, while 85% relied on fossil fuels. As much as 90% of world energy use derives from fossil sources, and this share is actually increasing. So why is the long-anticipated transition to renewable energy not materialising?
One highly contested issue is the land requirements for harnessing renewable energy. Energy experts like David MacKay and Vaclav Smil have estimated that the “power density” – the watts of energy that can be harnessed per unit of land area – of renewable energy sources is so much lower than that of fossil fuels that to replace fossil with renewable energy would require vastly greater land areas for capturing energy.
In part because of this issue, visions of large-scale solar power projects have long referred to the good use to which they could put unproductive areas like the Sahara desert. But doubts about profitability have discouraged investments. A decade ago, for example, there was much talk about Desertec, a €400 billion project that crumbled as the major investors pulled out, one by one.
Today the world’s largest solar energy project is Ouarzazate Solar Power Station in Morocco. It covers about 25 square kilometres and has cost around US$9 billion to build. It is designed to provide around a million people with electricity, which means that another 35 such projects – that is, US$315 billion of investments – would be required merely to cater to the population of Morocco. We tend not to see that the enormous investments of capital needed for such massive infrastructural projects represent claims on resources elsewhere – they have huge footprints beyond our field of vision.
Also, we must consider whether solar is really carbon free. As Smil has shown for wind turbines and Storm van Leeuwen for nuclear power, the production, installation, and maintenance of any technological infrastructure remains critically dependent on fossil energy. Of course, it is easy to retort that until the transition has been made, solar panels are going to have to be produced by burning fossil fuels. But even if 100% of our electricity were renewable, it would not be able to propel global transports or cover the production of steel and cement for urban-industrial infrastructure.
And given the fact that the cheapening of solar panels in recent years to a significant extent is the result of shifting manufacture to Asia, we must ask ourselves whether European and American efforts to become sustainable should really be based on the global exploitation of low-wage labour, scarce resources and abused landscapes elsewhere.
Solar power is not displacing fossil energy, only adding to it. And the pace of expansion of renewable energy capacity has stalled – it was about the same in 2018 as in 2017. Meanwhile, our global combustion of fossil fuels continues to rise, as do our carbon emissions. Because this trend seems unstoppable, many hope to see extensive use of technologies for capturing and removing the carbon from the emissions of power plants and factories.
Carbon Capture and Storage (CCS) remains an essential component of the 2016 Paris Agreement on climate change. But to envisage such technologies as economically accessible at a global scale is clearly unrealistic.
To collect the atoms of carbon dispersed by the global combustion of fossil fuels would be as energy-demanding and economically unfeasible as it would be to try to collect the molecules of rubber from car tires that are continuously being dispersed in the atmosphere by road friction.
The late economist Nicholas Georgescu-Roegen used this example to show that economic processes inevitably lead to entropy – that is, an increase in physical disorder and loss of productive potential. In not grasping the implications of this fact, we continue to imagine some miraculous new technology that will reverse the Law of Entropy.
Economic “value” is a cultural idea. An implication of the Law of Entropy is that productive potential in nature – the force of energy or the quality of materials – is systematically lost as value is being produced. This perspective turns our economic worldview upside down. Value is measured in money, and money shapes the way we think about value. Economists are right in that value should be defined in terms of human preferences, rather than inputs of labour or resources, but the result is that the more value we produce, the more inexpensive labour, energy and other resources are required. To curb the relentless growth of value – at the expense of the biosphere and the global poor – we must create an economy that can restrain itself.
The evils of capitalism
Much of the discussion on climate change suggests that we are on a battlefield, confronting evil people who want to obstruct our path to an ecological civilisation. But the concept of capitalism tends to mystify how we are all caught in a game defined by the logic of our own constructions – as if there was an abstract “system” and its morally despicable proponents to blame. Rather than see the very design of the money game as the real antagonist, our call to arms tends to be directed at the players who have had best luck with the dice.
I would instead argue that the ultimate obstruction is not a question of human morality but of our common faith in what Marx called “money fetishism”. We collectively delegate responsibility for our future to a mindless human invention – what Karl Polanyi called all-purpose money, the peculiar idea that anything can be exchanged for anything else. The aggregate logic of this relatively recent idea is precisely what is usually called “capitalism”. It defines the strategies of corporations, politicians, and citizens alike.
All want their money assets to grow. The logic of the global money game obviously does not provide enough incentives to invest in renewables. It generates greed, obscene and rising inequalities, violence, and environmental degradation, including climate change. But mainstream economics appears to have more faith in setting this logic free than ever. Given the way the economy is now organised, it does not see an alternative to obeying the logic of the globalised market.
The only way to change the game is to redesign its most basic rules. To attribute climate change to an abstract system called capitalism – but without challenging the idea of all-purpose money – is to deny our own agency. The “system” is perpetuated every time we buy our groceries, regardless of whether we are radical activists or climate change deniers. It is difficult to identify culprits if we are all players in the same game. In agreeing to the rules, we have limited our potential collective agency. We have become the tools and servants of our own creation – all-purpose money.
Despite good intentions, it is not clear what Thunberg, Extinction Rebellion and the rest of the climate movement are demanding should be done. Like most of us, they want to stop the emissions of greenhouse gases, but seem to believe that such an energy transition is compatible with money, globalised markets, and modern civilisation.
Is our goal to overthrow “the capitalist mode of production”? If so, how do we go about doing that? Should we blame the politicians for not confronting capitalism and the inertia of all-purpose money? Or – which should follow automatically – should we blame the voters? Should we blame ourselves for not electing politicians that are sincere enough to advocate reducing our mobility and levels of consumption?
Many believe that with the right technologies we would not have to reduce our mobility or energy consumption – and that the global economy could still grow. But to me, that is an illusion. It suggests that we have not yet grasped what “technology” is. Electric cars and many other “green” devices may seem reassuring but are often revealed to be insidious strategies for displacing work and environmental loads beyond our horizon – to unhealthy, low-wage labour in mines in Congo and Inner Mongolia. They look sustainable and fair to their affluent users but perpetuate a myopic worldview that goes back to the invention of the steam engine. I have called this delusion machine fetishism.
Redesigning the global money game
So the first thing we should redesign are the economic ideas that brought fossil-fueled technology into existence and continue to perpetuate it. “Capitalism” ultimately refers to the artefact or idea of all-purpose money, which most of us take for granted as being something about which we do not have a choice. But we do, and this must be recognised.
Since the 19th century, all-purpose money has obscured the unequal resource flows of colonialism by making them seem reciprocal: money has served as a veil that mystifies exploitation by representing it as fair exchange. Economists today reproduce this 19th-century mystification, using a vocabulary that has proven useless in challenging global problems of justice and sustainability. The policies designed to protect the environment and promote global justice have not curbed the insidious logic of all-purpose money – which is to increase environmental degradation as well as economic inequalities.
In order to see that all-purpose money is indeed the fundamental problem, we need to see that there are alternative ways of designing money and markets. Like the rules in a board game, they are human constructions and can, in principle, be redesigned. In order to accomplish economic “degrowth” and curb the treadmill of capital accumulation, we must transform the systemic logic of money itself.
National authorities might establish a complementary currency, alongside regular money, that is distributed as a universal basic income but that can only be used to buy goods and services that are produced within a given radius from the point of purchase. This is not “local money” in the sense of LETS or the Bristol Pound – which in effect do nothing to impede the expansion of the global market – but a genuine spanner in the wheel of globalisation. With local money you can buy goods produced on the other side of the planet, as long as you buy it in a local store. What I am suggesting is special money that can only be used to buy goods produced locally.
This would help decrease demand for global transports – a major source of greenhouse gas emissions – while increasing local diversity and resilience and encouraging community integration. It would no longer make low wages and lax environmental legislation competitive advantages in world trade, as is currently the case.
Immunising local communities and ecosystems from the logic of globalised capital flows may be the only feasible way of creating a truly “post-capitalist” society that respects planetary boundaries and does not generate deepening global injustices.
Re-localising the bulk of the economy in this way does not mean that communities won’t need electricity, for example, to run hospitals, computers and households. But it would dismantle most of the global, fossil-fuelled infrastructure for transporting people, groceries and other commodities around the planet.
This means decoupling human subsistence from fossil energy and re-embedding humans in their landscapes and communities. In completely changing market structures of demand, such a shift would not require anyone – corporations, politicians, or citizens – to choose between fossil and solar energy, as two comparable options with different profit margins.
To return to the example of Morocco, solar power will obviously have an important role to play in generating indispensable electricity, but to imagine that it will be able to provide anything near current levels of per capita energy use in the global North is wholly unrealistic. A transition to solar energy should not simply be about replacing fossil fuels, but about reorganising the global economy.
Solar power will no doubt be a vital component of humanity’s future, but not as long as we allow the logic of the world market to make it profitable to transport essential goods halfway around the world. The current blind faith in technology will not save us. For the planet to stand any chance, the global economy must be redesigned. The problem is more fundamental than capitalism or the emphasis on growth: it is money itself, and how money is related to technology.
Climate change and the other horrors of the Anthropocene don’t just tell us to stop using fossil fuels – they tell us that globalisation itself is unsustainable.
With a combination of scale, a growing population, outstanding irradiation, and available capital, solar PV should be a ‘no brainer’ for the Kingdom of Saudi Arabia. But early explorations of the technology have soured expectations, and progress has come in fits and starts.
Saudi Arabia’s renewable energy sector over the years can be best described as a roller coaster. Just when momentum seemed to be building, the ride came to a halt. Then it began to move, but never really gave potential investors the confidence needed for serious acceleration. Progress started to take shape in 2016 and has continued, showing that this time is different.
Yet, to understand how the country got to where it is today, it’s important to know where Saudi Arabia has been, and that stems all the way back to 1977.
Much like the creation of the national oil company Saudi Aramco — formed between the United States and Saudi Arabia — solar power has been explored as part of a bilateral partnership between the two countries. Saudi Arabia’s National Center for Science and Technology (now known as the King Abdulaziz City for Science and Technology or KACST) and the United States Department of Energy (DOE) struck a deal four decades ago for the Saudi Solar Village Project. The five-year agreement included $50 million from both countries and was extended for three more years. What resulted was a 350 kW solar PV system located 50 kilometers from Riyadh, as well as an additional 350 kW solar hydrogen demonstration plant.
The system operated well for its time, but the technology was nowhere near where it is today, which resulted in panel degradation of 20%. Operating temperatures were much higher than originally specified, and the heat sink insufficient for cooling.
From there continued a list of projects, including solar-powered water desalination, solar hydrogen utilization, solar water heating, and other PV research projects.
In 1990, the Persian Gulf War erupted and once again, Saudi Arabia saw solar power come via the United States. Solar panels were used to power GPS satellites, but just like the problem seen in the solar village, modules again quickly deteriorated in the harsh desert conditions.
There is little doubt that these observations helped shape the kingdom’s solar PV sector — and industry in general — but it would still take many years before substantial movement could be seen.
In April 2010, the King Abdullah City for Atomic and Renewable Energy (K.A.CARE) was established to be the “driving force for making atomic and renewable energy an integral part of a national sustainable energy mix.”
K.A.CARE’s target was to have 41 GW of renewable energy by 2032, with 16 GW of solar PV. In 2011, a contract was signed to establish a polysilicon plant in Jubail, which would begin the production of solar cell materials. Polysilicon Technology, alongside Hyundai Engineering and KCC Engineering and Construction, announced that it would build a $380 million plant to produce 3,350 metric tons of solar-grade polysilicon, with future expansion plans. This was one of many announcements that failed to materialize, as developer Polysilicon Technology later went bankrupt, according to local sources.
K.A.CARE went a step further in February 2013, when it published a white paper that announced a new renewable energy target of 54 GW by 2032 (41 GW was to be solar). And in the first five years, it planned for 5.1 GW to be installed, with 23.9 GW by 2020. The white paper has since been removed from the organization’s website, and K.A.CARE’s renewable energy ambitions disappeared along with it, as it began to focus more on nuclear power.
The new crown prince
Volatility in oil prices began in 2014, and it forced the country to broadly rethink its economic policies.
As Saudi Arabia grappled with the new normal of low oil prices, then deputy crown prince, Mohammed bin Salman, released a new economic vision for the country. The National Transformation Plan, part of the wider Vision 2030 agenda, was launched in 2016. It included a target to have 9.5 GW of solar and wind power feeding electricity into the national grid by 2023. It was understandable that the plan was met with leeriness, considering previous attempts to jump-start a renewable energy market in the country, but this time was different. This was the first time that Saudi Arabia had a government mandate to incorporate renewable energy into its overall energy mix.
In 2017, the Renewable Energy Project Development Office (REPDO) was created, featuring members from K.A.CARE, Saudi Aramco, Saudi Electricity Company, and the Electricity and Cogeneration Regulatory Authority. The new unit fell under the energy ministry’s oversight, and immediately began accepting applications from companies that were looking to participate in the development of 700 MW of solar and wind capacity projects.
Local company ACWA Power came in with the winning bid for the first utility-scale solar PV plant, Sakaka, at $0.0234/kWh. “PV is a no-brainer in our part of the world [to supply] a significant source of load,” said ACWA chief executive officer Paddy Padmanathan.
Yet what was also significant was how REPDO announced the winning bids, which was done via live stream. This showed a level of transparency that isn’t seen anywhere else in the region’s renewable energy sector.
In November 2018, Saudi Arabia’s first utility-scale solar PV project began construction, with more than 1.18 million modules and 1,200 new jobs. The Sakaka solar power plant began a new era in the kingdom, heralding a “more to come” drive with at least seven projects to be tendered in this year alone. And people started to believe it. In fact, Padmanathan said that throughout the region, more companies are jumping into the market — and they’re looking at Saudi Arabia. He estimates that over the past five years, there has been growth of 20% of new market players trying to get into the Middle East’s solar sector.
“Within the next five years, there will be a real race to deploy as much PV as possible throughout the region,” Padmanathan added.
And Saudi Arabia is a market mover for any sector, given its size and population of almost 33 million. So much so that many companies separate Saudi Arabia from their regional reports so that its size doesn’t skew results. The potential for the kingdom’s solar industry, coupled with its goal of creating a manufacturing hub, is enough to once again entice investors.
“We’ve been pushing anyone we’ve worked with for many years saying, ‘If you want to work with us and want to capture meaningful volumes — industrialize inside the kingdom,’” said Padmanathan.
Earlier this year, a Saudi consortium made up of the National Industrial Clusters Development Program and petrochemical giant SABIC, signed a memorandum of understanding with Longi Group and OCI for the development of a fully integrated solar manufacturing facility in the country. And such decisions may create momentum for others to move, particularly considering a potentially more favorable policy framework.
Gus Schellekens, a partner at the clean energy division of the consultancy EY, said that Saudi Arabia today is very different than pre-Vision 2030.
“New businesses are being set up that are very different to the old world that delivered success for the past 40 years,” Schellekens explained. Yet Saudi Arabia is still finding its footing. The head of REPDO, Turki Al Shehri, recently left the organization to join France’s Engie as the chief executive of Saudi Arabia. There has so far been no announcement about a replacement and sources have said that the energy ministry is instead looking to create a more centralized system.
It’s never an easy road when introducing a new model or system on a large scale, especially if people continue to focus on previous mistakes. “In the long run, there remains huge potential for Saudi Arabia, but it’s important to acknowledge practical challenges, and build on a robust plan that is integrated with other initiatives,” Schellekens concluded.
The pairing of wind and solar is emerging as a smart strategy to implement renewable energy sources with better economic feasibility.A Fine Couple They Are (Wind and Solar Power) as suggested by Jim Romeo would definitely affect this Energy Transition era if only in terms of duration.
The pairing of wind and solar power is an advantageous complement; the two benefit each other. The synergistic combination is an emerging trend in renewable energy and power generation as costs drop. The pairing of sustainable sources is in early stages, however. And the configuration still has challenges regarding return on investment (ROI), ease of implementation, and storage.
In western Minnesota, a 2-MW wind turbine and 500-kW solar installation—wind-solar hybrid project—is an early entrant to the wind-solar market and one of the first of its kind in the U.S. It was introduced at a cost of about $5 million with high expectations and the goal that Lake Region Electric Cooperative in Pelican Rapids would acquire the power for its 27,000 members.
The pioneering project got a boost amid the lower costs of solar. The power generation from both renewable sources is calculated to provide dividends on its investment.
According to market researcher Global Market Insights, hybrid solar-wind projects are expected to grow by 4% in the U.S. over the next five years to join a $1.5 billion global market. Some attribute the growth to the 2015 United Nations Climate Change Conference objectives, combined with lower costs of development and materials, and a keen interest by many nations to rely more on renewable energy sources. Because wind turbine power and solar both have excess capacity, together they offer far greater possibilities.
Lucrative but Limited
Renewables especially make economic sense in non-urban areas, where costs per kWh are higher, said Mike Voll, principal and sector lead for Smart Technologies at Stantec. “So, rural communities and remote locations, where energy prices often reach $0.40 to $0.45 per kilowatt-hour, actually see an ROI from these projects. When it comes to combining both wind and solar with storage, however, the list of locations is even smaller still. In a perfect world, we’d have a place that has excellent radiance with enough wind and low cloud cover, but the reality is there are very few locations that meet the geographic requirements. So even as the price continues to drop, there will still be significant limitations to pairing solar and wind.”
Despite limitations, renewables can work well in locations where everything clicks. A storage option is an essential component. “Adding energy storage can reduce intermittency of output, reshape the generation profile to match to load, and enable dispatch of the renewable energy to maximize revenue generation through ISO market participation or utility programs,” said Todd Tolliver, senior manager at ICF, a global consulting and technology services company headquartered in Fairfax, Virginia.
Tolliver said the economic viability of these systems is constrained by equipment, costs of storage, and limited or irregular revenue streams. But he explained that the most common combination today is solar plus battery storage, thanks to investment tax credit and incentive programs in certain markets that provide clear lower costs and better revenue streams. Still, wind power energy storage has challenges.
On the road from Wadi Rum to Petra in Jordan, where signs point to the Sheikh Zayed solar complex, wind turbines turn languidly in a steady breeze. At Petra, even Bedouin encampments have solar panels and many homes in Amman use solar tubes to heat water. The UAE made headlines with its world-record solar installations, but in all the Middle East, the impact of the renewable revolution is most visible in the Jordanian landscape.
By last year, the Hashemite kingdom had installed 285 megawatts of wind and 771MW of solar power, a significant chunk of its total generation of about 4 gigawatts. By 2021, it wants to have 2.7GW of renewable capacity. Over the next decade, Jordan’s efforts could really take off – providing half of all electricity output, in our analysis at Qamar Energy. It is only a small market, but it is an important trailblazer for the region’s aspirations in renewables.
Jordan’s success has been built on good resources, solid policy and the imperatives of an energy crisis. Like most Middle East countries, the kingdom has abundant sunny desert land and, similar to Egypt and northern Saudi Arabia, it’s also quite windy in places.
The country started early on encouraging renewables with the Tafila wind farm, a joint venture with Masdar, built in 2015. It offers investors a reasonable return and gives smaller users such as hospitals and universities the chance to build solar panels on vacant land and transmit the power through a grid.
The biggest impetus to alternative energy was the cut-off from Egyptian gas supplies following the 2011 revolution, because of repeated militant attacks on the Sinai pipeline. Jordan’s budget deficit widened because the country, which imports more than 90 per cent of its energy needs and has historically financed its deficits through grants and soft loans, had to burn expensive oil for electricity. Jordan, which already hosted thousands of Iraqi refugees, had to accommodate an increasing power demand due to an influx of 1.3 million Syrians escaping the conflict in their country.
In response, the kingdom opened a liquefied natural gas import terminal at Aqaba, and negotiated supplies from the American company Noble, which produces from offshore Israel. Jordan has large resources of oil shale, effectively an immature form of petroleum source rocks, which can be cooked into oil. A Chinese-led consortium is developing a power plant based on burning this dirty material.
Jordan’s success has been built on good resources, solid policy and the imperatives of an energy crisis.
Efforts to construct a nuclear power plant have been hampered by a lack of cooling water, public opposition and the high costs of financing. Instead, Amman may opt for smaller, modular nuclear reactors that could be fabricated off-site.
To cover the higher costs of fuel, energy subsidies had to be cut back, putting a heavy burden on citizens at a time of sharp economic slowdown. But this had the positive effect of making individual rooftop solar installations attractive for small businesses and householders.
Local Jordanian companies, such as Kawar Energy and Shamsuna Power, along with Dubai-based companies including Yellow Door Energy, have created viable businesses and high-skilled employment. By the early 2020s, Jordan will have the Middle East’s lowest carbon output electricity grid, despite the carbon-heavy oil shale facility.
Success will soon bring its own challenges. Renewable output will exceed total demand at times, while the country still needs to provide for high-consumption and night-time periods. Hydropower, which could be used to store excess renewables, is minimal in the desert country.
The Red-Dead Sea project is intended to bring water to the Dead Sea, which is fast drying up due to climate change and the overuse of the Jordan River. On the way, the water would generate power for desalination. But the expensive venture faces environmental concerns and political hurdles in co-operating with Israel.
Philadelphia Solar, a local company, has announced plans for a solar plant with battery storage. Concentrated solar thermal plants (CSP), like the one under construction in Dubai, can save the Sun’s heat to generate power overnight. These do not seem to be part of Jordan’s plans yet, but the country has excellent conditions for CSP.
Electricity interconnections with Egypt, Saudi Arabia, Iraq and the West Bank are also underway, which could boost the resilience and renewable share of the whole area’s power grid. It could also send power to help rebuild war-torn Syria.
Jordan’s consumers will have to consider the benefits from the country’s renewable expansion, particularly industries which have complained of high electricity prices. Prices are high during peak demand hours, but this scheme will have to become more flexible to lower prices when there is an excess of solar.
Jordan’s small market and head start in renewable energy means it will reach these hurdles to solar deployment probably before any other country in the region. Its success in devising policies to continue attracting capital, boosting its renewable generation, local employment and electricity exports, while reducing consumer bills, will be an important signal for its neighbours.
This is particularly true for countries in the Arabian Gulf – whose utility companies are thinking about how to overcome similar barriers to their bold renewable plans. Such complementary resources and opportunities open the space for co-operation between these two regional allies.
Robin Mills is CEO of Qamar Energy and author of The Myth of the Oil Crisis.
You may have seen a variant of this meme before. A map of North Africa is shown, with a surprisingly small box somewhere in Libya or Algeria shaded in. An area of the Sahara this size, the caption will say, could power the entire world through solar energy:
Over the years various different schemes have been proposed for making this idea a reality. Though a company called Desertec caused a splash with some bold ideas a decade ago, it collapsed in 2014 and none of the other proposals to export serious amounts of electricity from the Sahara to Europe and beyond are anywhere close to being realised.
It’s still hard to store and transport that much electricity from such a remote place, for one thing, while those people who do live in the Sahara may object to their homeland being transformed into a solar superpower. In any case, turning one particular region into a global energy hub risks all sorts of geopolitical problems.
The Imagine newsletter aims to tackle these big “what if” questions, so we asked a number of academics to weigh in on the challenges of exploiting the cheapest form of electricity from perhaps the cheapest and best spot on Earth.
Sahara has huge energy potential
Amin Al-Habaibeh is an engineer at Nottingham Trent University who has researched various options for Saharan solar.
He points to the sheer size and amount of sunshine the Sahara desert receives:
It’s larger than Brazil and slightly smaller than the US.
If every drop of sunshine that hits the Sahara was converted into energy, the desert would produce enough electricity over any given period to power Europe 7,000 times over.
So even a small chunk of the desert could indeed power much of the world, in theory. But how would this be achieved?
Al-Habaibeh points to two main technologies. Both have their pros and cons.
Concentrated solar power uses lenses or mirrors to focus the sun’s energy in one spot, which becomes incredibly hot. This heat then generates electricity through a steam turbine.
In this image the tower in the middle is the “receiver” which then feeds heat to a generator:
Some systems store the heat in the form of molten salt. This means they can release energy overnight, when the sun isn’t shining, providing a 24h supply of electricity.
Concentrated solar power is very efficient in hot, dry environments, but the steam generators use lots of water.
Then there are regular photovoltaic solar panels. These are much more flexible and easier to set up, but less efficient in the very hottest weather.
Overall, Al-Habaibeh is positive:
Just a small portion of the Sahara could produce as much energy as the entire continent of Africa does at present. As solar technology improves, things will only get cheaper and more efficient. The Sahara may be inhospitable for most plants and animals, but it could bring sustainable energy to life across North Africa – and beyond.
Solar panels could have remarkable impact on the desert though
Installing mass amounts of solar panels in the Sahara could also have a remarkable impact on the desert itself.
The Sahara hasn’t always been dry and sandy. Indeed, archaeologists have found traces of human societies in the middle of the desert, along with prehistoric cave paintings of Savannah animals. Along with climate records, this suggests that just a few thousand years ago the “desert” was far greener than today.
Alona Armstrong, an environmental science lecturer at Lancaster University, wrote about a fascinating study in 2018 that suggested massive renewable energy farms could make the Sahara green again.
This may be a nice side effect of a huge Saharan solar plant, but it doesn’t necessarily mean it should happen. As Armstrong points out:
These areas may be sparsely populated but people do live there, their livelihoods are there, and the landscapes are of cultural value to them. Can the land really be “grabbed” to supply energy to Europe and the Middle East?
Is this climate colonialism?
If we want to deploy millions of solar panels in the Sahara, then who is “we”? Who pays for it, who runs it and, crucially, who gets the cheap electricity?
This is what worries Olúfẹ́mi Táíwò, a philosopher who researches climate justice at Georgetown University. He mentions Saharan solar power as one of the possible policies involved in a Green New Deal, a wide-ranging plan to enact a “green transition” over the next decade.
He points out that exports of solar power could: “Exacerbate what scholars like sociologist Doreen Martinez call climate colonialism – the domination of less powerful countries and peoples through initiatives meant to slow the pace of global warming.”
While Africa may have abundant energy resources, the continent is also home to the people who are the least connected to the grid.
Solar exports risk “bolstering European energy security … while millions of sub-Saharan Africans have no energy of their own.”
What if we’re looking at the wrong desert?
All of this will be moot if Saharan solar never actually happens. And Denes Csala, a lecturer in energy systems at Lancaster University, is sceptical.
It’s true that much of the world’s best solar resources are found in the desert. Here’s a graph from his PhD research which shows how Saharan nations dominate:
But Denes says that we’re looking at the wrong desert. In fact, the countries of the Arabian peninsula are better placed to exploit the sun. He argues several factors work in favour of Saudi Arabia, the UAE and co:
They have a history of exporting oil.
In the energy market, worries over security of supply means countries tend to do business with the same partners over time.
Ports, pipes and other infrastructure that have been built to ship oil and gas could be repurposed to ship solar energy as hydrogen.
[Energy security] would be the Achilles heel of a northern African energy project: the connections to Europe would likely be the continent’s single most important critical infrastructure and, considering the stability of the region, it is unlikely that European countries would take on such a risk.
It would be fair to say academics have mixed views about the idea of mass Saharan solar. While the energy potential is obvious, and most of the necessary technology already exists, in the long run it may prove too complicated politically.
Still think this is all fantasy?
Maybe Europeans should look closer to home. The UK Planning Inspectorate is currently examining the Cleve Hill solar farm proposal in Kent, which would involve installing nearly a million solar panels across a marshland site the size of 600 football pitches. To protect against flooding, the panels would be mounted several metres in the air. If built, despite opposition from locals and conservationists, Cleve Hill would be by far the country’s largest solar farm and about the same size as Europe’s largest, near Bordeaux.
Alastair Buckley from the University of Sheffield points out the project would be groundbreaking as, unlike other ventures of this kind, it doesn’t rely on subsidies. With solar power getting ever cheaper, Cleve Hill – if it happens – seems to mark the moment when solar may start paying for itself – even far from the world’s deserts.
Imagine is a newsletter from The Conversation that presents a vision of a world acting on climate change. Drawing on the collective wisdom of academics in fields from anthropology and zoology to technology and psychology, it investigates the many ways life on Earth could be made fairer and more fulfilling by taking radical action on climate change. You are currently reading the web version of the newsletter.
CAIRO (Reuters) – Egypt expects the 1.6-gigawatt solar park it is building in the south of the country to be operating at full capacity in 2019, the investment ministry said in a statement on Sunday.
The $2 billion project, set to be the world’s largest solar installation, has been partly funded by the World Bank, which invested $653 million through the International Finance Corporation.
Some parts of the park are already operating on a small scale, while other areas are still undergoing testing.
Egypt aims to meet 20 per cent of its energy needs from renewable sources by 2022 and up to 40 per cent by 2035. Renewable energy currently covers only about 3 per cent of the country’s needs.
“Egypt’s energy sector reforms have opened a wider door for private sector investments,” World Bank President David Malpass said during his visit to the site alongside Egypt’s Investment Minister Sahar Nasr.
Egypt is on a drive to lure back investors who fled following the 2011 uprising with a slew of economic reforms and incentives the government hopes will draw fresh capital and kickstart growth.
Most of the foreign direct investment Egypt attracts goes toward its energy sector.
Reporting by Ehab Farouk; Writing by Nadine Awadalla; Editing by Yousef Saba and Jan Harvey.
Every now and then, the idea of powering Europe using the vast solar resources of the Sahara Desert comes up. Were this to actually happen, we may witness the rise of new energy superpowers in Northern Africa. But a look at the economic and political energy system suggests what’s more likely is the oil-rich countries of the Arabian (or Persian) Gulf will continue to dominate energy trade even in the post-fossil era.
Renewable energy, of course, is very location dependent – the sunnier a place is, the more energy you get out of photovoltaic panels. Over the course of a year, southern Algeria, for example, gets more than twice as much solar energy as southern England. The graph below, which I put together as part of my PhD, shows that some of the best solar resources in the world are indeed found in Algeria, Libya, Egypt, Niger, Chad and Sudan.
So, one could build large Saharan solar farms and then transmit the power back to densely populated areas of Europe. Such a project would need to overcome various technical challenges, but we can say that in theory it is possible, even if not practical.
Yet plans to actually set up mass Saharan solar have floundered. The most notable project, Desertec, was fairly active until the mid 2010s, when a collapse in the price of oil and natural gas made its business case more difficult. At that time, the major technology considered was concentrated solar power, where you use the heat from the sun to run a steam turbine. Energy can be stored as heat overnight, therefore enabling uninterrupted energy supply and making it preferred to then expensive batteries.
Since then, however, the cost of both solar panels and battery storage have dropped drastically. But, while conditions might look favourable for Saharan solar, it is unlikely that new solar energy kingpins will arise in North Africa. Instead, we should look one desert further to the East – the Rub al Khali on the Arabian peninsula, the home of the reigning energy powers.
Sun shines on the Gulf
The economies of the United Arab Emirates, Saudi Arabia, Qatar and the other Gulf nations are built around energy exports. And as climate change imposes pressure on the extraction of fossil fuels, these countries will have to look for alternative energy (and income) sources in order to keep their economies afloat. The International Renewable Energy Agency set up its headquarters in Abu Dhabi, and the region has no shortage of ambitious solar projects promising extremely cheap electricity. However only a small amount of capacity has actually been deployed so far. Low oil revenues have not helped with the megaprojects.
Countries in the Sahara also have little history of trading fossil fuels, outside of Libya and Algeria, while things are rather different for the petro-states of the Gulf. And this matters because, in the energy business, worries over longer-term security of supply mean countries tend to trade with the same partners.
This would be the Achilles’ heel of a Northern African energy project: the connections to Europe would likely be the continent’s single most important critical infrastructure and, considering the stability of the region, it is unlikely that European countries would take on such a risk.
Which brings us to an alternative way to transmit energy: hydrogen. A process called electrolysis can use renewable electricity to split water into hydrogen and oxygen, and the resulting hydrogen can store lots of energy. Soon it will become feasible to move energy around the world in this form, using shipping infrastructure similar to that already in use today for liquefied natural gas.
Sure, there are disadvantages compared to batteries. It would mean introducing two more conversion stages and thus reduced efficiency (30% roundtrip efficiency compared to 80% for batteries), but it would overcome the distance barrier. And perhaps just as importantly: shipping energy by hydrogen would mean no significant change to the existing maritime trade infrastructure, which will hand an advantage to established energy exporters.
If this means the Sahara is unlikely to develop renewable energy superpowers, then perhaps this is for the better. With the booming populations of Sub-Saharan Africa in dire need of electrification, clean solar power might be better used to alleviate the energy crisis in somewhere like Nigeria rather than sent to Europe. While these countries may eventually be able to shake off any solar resource curse, in the short term, exports like these could just look like yet another European attempt to extract natural resources from Africans.
Whenever I visit the Sahara I am struck by how sunny and hot it is and how clear the sky can be. Aside from a few oases there is little vegetation, and most of the world’s largest desert is covered with rocks, sand and sand dunes. The Saharan sun is powerful enough to provide Earth with significant solar energy.
The statistics are mind-boggling. If the desert were a country, it would be fifth biggest in the world – it’s larger than Brazil and slightly smaller than China and the US. Each square metre receives, on average, between 2,000 and 3,000 kilowatt hours of solar energy per year, according to NASA estimates. Given the Sahara covers about 9m km², that means the total energy available – that is, if every inch of the desert soaked up every drop of the sun’s energy – is more than 22 billion gigawatt hours (GWh) a year.
This is again a big number that requires some context: it means that a hypothetical solar farm that covered the entire desert would produce 2,000 times more energy than even the largest power stations in the world, which generate barely 100,000 GWh a year. In fact, its output would be equivalent to more than 36 billion barrels of oil per day – that’s around five barrels per person per day. In this scenario, the Sahara could potentially produce more than seven times the electricity requirements of Europe, with almost no carbon emissions.
What’s more, the Sahara also has the advantage of being very close to Europe. The shortest distance between North Africa and Europe is just 15km at the Strait of Gibraltar. But even much further distances, across the main width of the Mediterranean, are perfectly practical – after all, the world’s longest underwater power cable runs for nearly 600km between Norway and the Netherlands.
Over the past decade or so, scientists (including me and my colleagues) have looked at how desert solar could meet increasing local energy demand and eventually power Europe too – and how this might work in practice. And these academic insights have been translated in serious plans. The highest profile attempt was Desertec, a project announced in 2009 that quickly acquired lots of funding from various banks and energy firms before largely collapsing when most investors pulled out five years later, citing high costs. Such projects are held back by a variety of political, commercial and social factors, including a lack of rapid development in the region.
More recent proposals include the TuNur project in Tunisia, which aims to power more than 2m European homes, or the Noor Complex Solar Power Plant in Morocco which also aims to export energy to Europe.
There are two practical technologies at the moment to generate solar electricity within this context: concentrated solar power (CSP) and regular photovoltaic solar panels. Each has its pros and cons.
Concentrated solar power uses lenses or mirrors to focus the sun’s energy in one spot, which becomes incredibly hot. This heat then generates electricity through conventional steam turbines. Some systems use molten salt to store energy, allowing electricity to also be produced at night.
CSP seems to be more suitable to the Sahara due to the direct sun, lack of clouds and high temperatures which makes it more efficient. However the lenses and mirrors could be covered by sand storms, while the turbine and steam heating systems remain complex technologies. But the most important drawback of the technology is its use of scarce water resources.
Photovoltaic solar panels instead convert the sun’s energy to electricity directly using semiconductors. It is the most common type of solar power as it can be either connected to the grid or distributed for small-scale use on individual buildings. Also, it provides reasonable output in cloudy weather.
But one of the drawbacks is that when the panels get too hot their efficiency drops. This isn’t ideal in a part of the world where summer temperatures can easily exceed 45℃ in the shade, and given that demand for energy for air conditioning is strongest during the hottest parts of the day. Another problem is that sand storms could cover the panels, further reducing their efficiency.
Just a small portion of the Sahara could produce as much energy as the entire continent of Africa does at present. As solar technology improves, things will only get cheaper and more efficient. The Sahara may be inhospitable for most plants and animals, but it could bring sustainable energy to life across North Africa – and beyond.