Dubai to Invest $3B in Solar Farms

Dubai produces only around 100,000 barrels per day of oil from four existing fields, and is dependent on fossil fuels for electricity production and for water, which must be desalinated. So news that Dubai is planning a gigantic solar farm with a capacity of 1,000 MW (1 GW), would seem like an appropriate response, right?

However, the speed of building the Sheikh Mohammed Bin Rashid Al Maktoum Solar Park - named after the ruler of Dubai – is strikingly at odds with Dubai’s world-famous dispatch in speedy project development. The 1,000 MW solar farm will take till 2030 to complete!

Unlike ambitious Morocco (Could Morocco be First to Get 42% Solar?) and Egypt, which has requested bids to get 2, 700 MW of wind by 2016, and similarly blessed with abundant desert sun, Dubai’s solar will still only play a minor role in the sun-soaked region.

Solar power will supply just 5% of Dubai electricity by 2030.

It will take two years to get the first 1% (10 MW) up and running.  The solar farm will be built and hooked-up in stages, with the first 10 MW hooked-up and shipping power to the grid by the end of 2013. Solar farms can be built very quickly. First Solar completed its solar farm in a few months in California, once the environmental reviews were completed.

Dubai is home to only 2 million people. However, they are some of the most energy-hungry people in the world, being entirely dependent on fossil energy to desalinate all of their water.  Dubai gets only 6% of its income from oil, and what oil it has is expected to be gone by 2020.

In 2010, Dubai consumed around 33,000 gigawatt hours (GWh) of electricity and energy demand is expected to increase by 5% annually – without intervention. (However, Dubai has passed some very tough energy-efficiency rules to cut electricity use, like its New Net Zero Building Code.)

The first stage will cost 120 million dirhams, but the entire solar farm will cost a total of $3 billion US dollars.

It is to be initially funded by the kingdom’s Supreme Council of Energy, whose members include various government entities such as the Dubai Supply Authority and Dubai Petroleum Establishment as well as Dubai Aluminum Company (DUBAL) and Emirates National Oil Company.

Then for the financing of the rest of the project, the Supreme Council of Energy was studying several options, like developing a clean energy fund – which would essentially be more of the same ownership; by the kingdom – but also encouraging private partnership, said Nejib Zaafrani, secretary general and chief executive officer of Supreme Energy Council.

Dubai will also import nuclear power from its neighbor Abu Dhabi. Other than the 5% it plans to get from solar, Dubai expects to import 12% of its electricity from nuclear power, get 12% from some sort of “clean coal”, and the rest from natural gas, as part of its relatively modest and slow-moving goal to reduce its current carbon emissions 30% by 2030.