The ongoing shift in the grid is impacting the UAE, says Michel Madi, CEO – Middle East, Africa & India, Networked Energy Services Corporation
The term ‘Smart Grid’ was used nearly a decade ago to define the intersection of electrical grids and information technology, although it did not encompass the ‘grid intelligence’ we have today where power-generating resources operate as a connected device. One of the biggest achievements of the 21st century is the intelligent control of distributed energy, which has become possible with the Internet of Things (IoT).
The legacy system generated power from grids located in remote areas, which were controlled by a centralized system of a utility that had limited visibility and insight of the load and generation. However, the outdated system has given way to a network of distributed generation, which has the capability of producing electricity onsite. While generating, storing and distributing electricity, these grids are creating data, which can be collected and analysed to optimise performance in real time.
In the US, a fully deployed Smart Grid is expected to generate $130bn by 2019. In addition, new opportunities worth $59bn in customer applications will encourage customers to reduce consumption. An additional $63bn and $9bn in grid applications and advanced metering, respectively, could result in improved grid efficiency and reliability. Europe, on the other hand, has a long way to go to reach the levels of the US; however, it will make an investment of $10bn until 2050 in Smart Grids, according to the International Energy Agency.
The GCC has a huge challenge of diversifying and conserving electricity, developing renewable energy sources, and reducing its carbon footprints with the employment of Smart Grid technologies for efficient management of their resources through modern infrastructure. Innovative power grids will help bolster the region’s reliance away from oil and gas resources to alternative power sources and help the region save up to $10bn in infrastructural investment by 2020 with the deployment of Smart Grids.
Spearheading the GCC with its path-breaking initiatives is the UAE, which has a clear focus on sustainable development. With the deployment of Smart Grids, the UAE can integrate clean energy sources into its electrical systems, enabling it to increase its output by optimally harnessing untapped energy from wind and solar sources. While wind and solar energy can have invariable outputs, Smart Grid technologies optimise output variability and increase its reliability, further reinforcing the country’s commitment to sustainable development.
The UAE has unveiled its ambitious Energy Plan 2050 in line with the UAE Vision 2021, which aims to reduce carbon dioxide emissions by 70%, increase clean energy use by 50%, and improve energy efficiency by 40%, resulting in savings of $190.7bn. The policy calls for 44% of energy for local consumption to be generated from renewable sources, 38% from gas, 12% from clean fossil, and 6 per cent from nuclear resources by 2050; 90 per cent currently comes from natural gas. An investment of $163.4mn will be made over the next 33 years to fund the integration of renewable, nuclear and clean fossil energies with an annual expense of more than $4.6bn.
Already a global trend, Smart Grids have seen an annual growth rate of 30% in the past decade alone. As the cornerstones of new opportunities in the UAE’s utilities sector, Smart Grids have transformed the way energy is produced and consumed, penetrating further into the distribution system to improve energy efficiency. With easy access to newly available energy data, the information is being used to develop better products and services for consumers who can now better take control of their consumption and monthly utility bills. In the near future, aside from power generation and distribution, Smart Grids will significantly help in the development of other strategic sectors such as electric cars or renewables with their integration into the system to improve power flows and reduce losses in the UAE.