Abu Dhabi’s balanced and diversified energy transition

February 27, 2023

H.E. Eng. Awaidha Murshed Ali Al Marar, chairman of the Abu Dhabi Department of Energy (DoE), talks to The Energy Year about how Abu Dhabi is bolstering its dynamic renewables sector and the impact of digitalisation and nuclear power on its energy industry. The DoE is a regulatory agency responsible for driving Abu Dhabi’s energy transition.

This interview is featured in The Energy Year UAE 2023

What types of cross-sector partnership and financial incentives is Abu Dhabi providing to bolster its renewable energy sector?

Abu Dhabi supports international efforts and UN Sustainable Development Goals to address the increasing challenges of climate change and is an early mover in the shift to clean energy. We are driving a strong energy transition initiative, reducing energy-related greenhouse gas emissions through deployment of clean energy technologies such as solar, hydrogen, storage and nuclear.
The UAE Net Zero by 2050 strategic initiative is a significant milestone that reflects the country’s long-term dedication to sustainable economic development and to the tenets of the 2015 Paris Agreement on Climate Change. It aligns with the Paris Agreement and reflects the UAE’s roadmap for accelerating development that was launched in September 2021 to mark the country’s Golden Jubilee. Designed as a multi-stakeholder initiative, it envisages that several key sectors driving the UAE’s socioeconomic agenda will act together and take strategic decisions to shape our future through the next 50 years.
Our large-scale initiatives are supported by policy and regulatory enablers and carbon reduction ideas from four main sectors – energy, environment, transport and industry. We have also outlined key sector initiatives over the next 10 years and launched nine projects focused on clean electricity generation from solar and nuclear sources, electrification of water production through RO [reverse osmosis] technology and energy efficiency and demand-side management strategies.
Together, these projects will drive electricity generation by 2025 to be 7% produced from solar PV sources and 39% from nuclear. This means 46% of Abu Dhabi’s energy in 2025 will be generated from clean sources, which is expected to halve power generation emissions from 2021 to 2025.
The large clean energy projects will help to not only meet our ever-growing local consumption needs but also attract foreign investment and international know-how to Abu Dhabi, which is essential to developing our knowledge economy. Our Clean Energy Certificate scheme to help businesses clean up their operations also helps drive investment into these projects.
And finally, we support scaling up the energy transition with sustainable finance options to drive economic diversification and attract investments. Abu Dhabi’s Green Bond Programme is a joint initiative between the DoE, Abu Dhabi Global Market (ADGM) and Abu Dhabi Securities Exchange (ADX). The aim of the initiative is to establish Abu Dhabi as a regional hub for issuing green bonds and green sukuk for sustainable projects in the emirate and across the Middle East and Africa. The global green bond market is worth over USD 200 billion, with the Middle East and Africa market expected to be worth over USD 1 billion-2 billion today and growing fast.

In what ways is Abu Dhabi leveraging solar PV and CSP projects to help satisfy its electricity demand?
Abu Dhabi is among the Middle East’s front-runners in adopting clean sources into our energy mix. Our transition to a cleaner, more sustainable energy system began with substantial utility-scale solar projects. We are committed to solar PV technology due to its cost effectiveness, and we account for 79% of the installed solar PV capacity in the region. We are considering the construction of a new solar PV plant by 2026 with a total capacity of 2 GW.
In 2008, we established Masdar and maximised investment in renewable projects locally and abroad as well as R&D, thus cementing the emirate’s position as a leader in clean energy technology. Since then, we have witnessed a trend for increasingly ambitious solar projects like the 1.2-GW Noor Abu Dhabi and 2-GW Al Dhafra projects.
Our Al Dhafra Solar PV project has recorded one of the most cost-competitive tariffs at AED 4.97 fils [USD 1.35] per kWh on a levelised cost basis. This is nearly 44% lower than the world-record tariff achieved for the 1.2-GW Noor Abu Dhabi Solar PV project in 2017. We expect this trend of costs being lowered to continue in the future.

 

How will Abu Dhabi’s new policy approach consolidate its international leadership in hydrogen while developing a strong local hydrogen economy?
We have recently announced the development of a hydrogen policy and regulatory framework that aims to accelerate Abu Dhabi’s national hydrogen strategy and help the nation attain global leadership in low-carbon and clean hydrogen. For the design of this regulatory framework, we are working with key Abu Dhabi government and commercial sector stakeholders.
Locally produced hydrogen will function as a catalyst for innovation and economic diversification, enabling the decarbonisation of the economy and supporting the emirate’s needs for economic, environmental and social sustainability. Our new hydrogen policy and regulatory framework aims to clearly define policies, regulations, standards and certifications for the emerging hydrogen industry to be globally competitive. It can potentially increase low-carbon hydrogen production in Abu Dhabi to more than a million tonnes per annum by 2030.
Hydrogen will begin to play a significant role and account for as much as 18% of global energy demand by 2050 and the global market for green hydrogen may eventually reach 500 million metric tonnes by the same year. In addition, the cost of green hydrogen is expected to become competitive with blue hydrogen by 2025 and with grey hydrogen by 2030. According to industry reports, the long-term cost of green hydrogen production could potentially reach USD 1.5-2 per kg.
Abu Dhabi has a unique competitive advantage as a base for hydrogen production thanks to its industrial capacity across the energy value chain, its advanced infrastructure and solid experience in export shipment of flammable materials, its central location between large demand markets and due to its significant financing abilities and flexible, enabling foreign investment regulatory frameworks.

How is technology transforming Abu Dhabi’s energy industry? What role does AI play in the transition from an oil-based economy to a knowledge-based one?
We are trying to create a balanced and diversified energy transition and taking bold measures to reduce domestic emissions with the help of new technology. The DoE has long prioritised adopting advanced technologies to render processes and operations more sustainable along the entire supply chain. For example, we are capitalising on CCUS technologies and deploying them at a significant scale for CO2-enhanced oil recovery.
We are also stepping into hydrogen, which has an immense potential to support the transition to a carbon-neutral economy and a responsible hydrocarbons industry capable of producing fuels and petrochemical products with low emissions.
The DoE enacts policies, and regulations to enhance the sector’s readiness to adapt to and overcome global challenges, in line with the forward-thinking vision and directives of the wise UAE leadership. Our strategy includes the use of technology including AI to further diversify energy sources, increasing the share of clean energy, deploying smart systems and digital services in the operational side of the business, undertaking demand-side management and ensuring efficiency in managing energy and water resources.

What role will nuclear energy play in energy reliability and sustainability in the UAE?
Abu Dhabi’s transition to a cleaner, more sustainable energy system is underway. To transform its power generation, the emirate is developing a nuclear energy programme alongside a substantial utility-scale solar project.
In addition to power generated from solar power plants in Abu Dhabi, if we add in the baseload nuclear energy expected upon full operation of the four nuclear reactors at the Barakah plant, we will have a combined 8.2 GW of installed clean and renewable energy capacity by 2025.
Nuclear power is clean and has zero emissions, which makes it key to promoting social wellbeing by creating a cleaner, healthier living environment. It also provides a reliable baseload, enhancing our energy security. Having nuclear power adds to our diverse sustainable energy generation sources and contributes to our security of supply, which in turn benefits society since we can provide electricity to other essential electricity-dependent services like healthcare, communications, travel and more vital services in our modern life.
Our large nuclear power generation capacity not only helps to meet our growing local consumption needs but also supports our electrification plans. It opens new opportunities to explore production of alternative energies like pink hydrogen. More opportunities also lie ahead in terms of using any surplus capacity to support neighbouring Arab countries under our regional interconnected network plans.

What regulatory and practical baselines is the DoE pushing in order to grow Abu Dhabi’s electric vehicle (EV) and EV infrastructure market?
Enabling EV vehicle ownership and EV charging infrastructure in the emirate is in line with Abu Dhabi’s economic diversification strategies and commitment to the Paris Agreement on climate change. Given that the largest demand for energy comes from the industry, construction and transport, the DoE recognises that decarbonising these sectors requires electricity from clean and renewable sources.
Therefore, one of our key focuses at the DoE is to support the electrification of our transportation sector, and with the globally proven benefits of increasing the use of electric vehicles that are charged from the electrical grid system, we have built a strong economic and environmental case for growing Abu Dhabi’s EV and EV infrastructure markets.
In 2022, the DoE issued the Regulatory Policy for the Electric Vehicle Charging Infrastructure, which aims to define the deployment framework for electric vehicle supply equipment (EVSE) in Abu Dhabi. The policy supports the Department of Transport’s Low Emissions Vehicle Strategy, acts as an enabler for the EV transition opportunity and is in line with Abu Dhabi’s readiness to scale EVSE requirements to meet future demand.
In addition, the introduction of the Electric Vehicle Charging System (EVCS) tariff is a strategic step towards the DoE’s technical guidelines enabling EV chargers in 2017. The policy sets a long-term, viable tariff structure and regulatory framework that will encourage expansion in EV charging infrastructure, which will in turn encourage the uptake of EVs in the emirate.
With Abu Dhabi’s robust power network and high technical standards, as well as data from these EV meters, the DoE will continue to ensure the energy network can support the emirate’s growth and future development. Setting a cost-reflective tariff for EV charging ensures the fair competition of different energy sources for the transport sector while considering the potential of reducing the negative environmental impacts.

What short- to medium-term goals does the DoE have for transforming Abu Dhabi into a world-class model combining the latest technology, sustainability and social responsibility tools?
At COP27, the DoE announced new regulations aimed at generating a substantial proportion of Abu Dhabi’s electricity from clean and renewable sources by 2035, marking a significant milestone in the UAE’s journey to deliver carbon neutrality by 2050. The new regulations project that 60% of the emirate’s electricity will be generated from clean and renewable sources by 2035.
The DoE’s Clean Energy Strategic Target 2035 for Electricity Production in Abu Dhabi regulatory framework is the first legally binding clean and renewable energy target in the Middle East. It forms part of an ongoing energy transition to accelerate the UAE’s decarbonisation and green growth efforts.
As the regulator and policymaker for the energy sector, our role is to ensure all initiatives to increase clean energy capacity and reduce emissions are backed by forward-looking policies and flexible regulations that we continuously optimise to enable the energy transition.
The DoE has invested significant resources into the development of technologies that facilitate decarbonisation efforts across Abu Dhabi and the wider UAE. The department has set itself an ambitious digitisation target to improve accessibility and deliver a wide range of essential amenities through online platforms that offer convenience and ensure continuity for customers.
At the GITEX Global 2022 event, we highlighted the Abu Dhabi Socioeconomic Module that creates a structure for assessing the impact of energy policies on various socioeconomic factors. It enables the DoE to create policies that deliver the most beneficial results for the community. It helps generate a range of socioeconomic outputs, such as GDP, including energy sector GDP and non-energy sector GDP; employment levels; and inflation, among others. It develops the DoE’s capacity to assess the socioeconomic impact of alternative energy policies, and supports alignment and co-ordination of the socioeconomic outputs with the sector stakeholders.
We have also updated the Unified Licensing & Business Regulations Platform, which consolidates all the department’s internal systems on one platform. It facilitates the activities of internal employees and licensed companies alike, enabling procedures to be conducted through a single ecosystem.
We further demonstrated Phase 2 of its Energy & Water Intensity Heat Map, which employs 3D mapping and building information modelling (BIM) to extend the functionality of the department’s geospatial dashboard, which will allow policymakers with actionable insights based on the energy and water usage of buildings across Abu Dhabi.

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