The Dubai Electricity and Water Authority (Dewa) is planning Dh20 billion worth of investment in the emirate’s energy sector as it prepares to host Expo 2020.
The utility is seeking financing for projects ranging from an ambitious “clean coal” plant to a 1,000-megawatt solar park, Saeed Mohammed Al Tayer, the managing director and chief executive of Dewa, said yesterday.
Dewa has accumulated a hefty margin of spare capacity – it had 9,700 megawatts of capacity to meet last summer’s peak demand of 6,500 megawatts, according to its figures – but it will need to ramp that up to meet heightened demand during the Expo, said Bob Bryniak, the chief executive of Golden Sands, a power consultancy.
"Dubai’s not behind, but it’s just the rate of growth that’s expected, especially when you take into account plans for 2020," said Mr Bryniak. “It’s feasible, and that’s largely because they’re sort of taking a broad approach to this. They’re pursuing solar, they’re pursuing coal, they’re heavily promoting energy conservation and energy efficiency.”
Dewa plans to expand its 2,030-megawatt power and water plant at Jebel Ali by another 600 megawatts by the end of this year,it will award a contract for the first 100 megawatts of its planned solar park, said Mr Al Tayer.
Earlier this month the utility hired a consultancy to advise on the 1,200-megawatt clean-coal plant, which is expected to inject greenhouse gases underground.
The company spent roughly Dh3.5bn last year and the year before, which puts the Dh20bn figure in line with normal spending if spread over a five-year period, said Karim Nassif, the associate director of infrastructure finance at Standard & Poor’s in Dubai.
"We’re not expecting them to spend Dh10 billion this year and the next,” he said. "Our understanding is that the company has quite a healthy capacity margin, well in excess of 25 per cent based on the peak load, so it doesn’t have any pressing need apart from investment in maintenance and repair to the existing distribution network."