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Thursday, 4 Jan 2024

What We’re Tracking Today
Solar
Coffee With..,
Macro Picture
Also On Our Radar
Climate In The News
On Your Way Out
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Acwa Power begins commercial operations on Sudair solar plant’s third and final phase

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Today at a glance

1

SOLAR

Acwa Power begins commercial operations on Sudair solar plant’s third and final phase.
2

Coffee With…

We chat with Peec Mobility’s founder Zach Faizal about EV repurposing technology.
3

ALSO ON OUR RADAR

KSA’s SPWC opens tender for more desalination plants.
4

WHAT WE’RE TRACKING TODAY

Global asset managers are turning to energy efficiency investments over renewables.
5

MACRO PICTURE

Fewer than 4% of global engineering firms have confidence in their climate resilience skills, IET survey finds.
6

ON YOUR WAY OUT

Iran’s ‘desert gold’ saffron industry is drying up due to climate change.

Thursday, 4 Jan 2024

What We’re Tracking Today
Solar
Coffee With..,
Macro Picture
Also On Our Radar
Climate In The News
On Your Way Out
Calendar
1

WHAT WE’RE TRACKING TODAY

TODAY: More Acwa Power solar on deck + SPWC opens tender for more desalination plants

Good morning, nice people. The news cycle remains eerily quiet as we slide into the weekend, with just a couple of stories making blips in the headlines…

OUR TOP CLIMATE STORY- Acwa Power received the commercial operation certificate to begin operating the third and final phase of its 1.5 GW Sudair solar project.

^^ We have the details on this story and more in the news well, below.

THE BIG CLIMATE STORY OUTSIDE THE REGION- Iberdrola calls off USD 8.3 bn acquisition of rival PNM: Avangrid, the US arm of Spanish renewables giant Iberdrola, has called off plans for a USD 8.3 bn takeover over of New Mexico-headquartered energy holding company PNM Resources after failing to secure regulatory approvals. The deal would have seen Avangrid acquire both PNM and its two utilities — Public Service Co. of New Mexico and Texas New Mexico Power — at a USD 4.3 bn investment ticket, excluding debt. The merger was unanimously approved by PNM's board in 2020 and was aimed at establishing a renewable energy operator with a combined market value exceeding USD 20 bn, paving the way for Avangrid to capitalize on New Mexico’s wind and solar energy potential.

The story grabbed some ink in the international press:Financial Times | Reuters | Bloomberg | The Washington Post | AP News

WATCH THIS SPACE-

#1- Germany + Portugal made strides in renewable energy last year: Portugal hit a record of sourcing 61% of its electricity needs from renewable energy in 2023, up from 49% in 2022, Reuters reports, citing grid operator REN. The country is targeting an 85% share of energy generation from renewables by 2030. Germany's renewable energy share also rose to 55% in 2023, a 6.6 percentage point increase from the year before, Reuters writes. Offshore wind contributed 31.1%, solar 12.1%, biomass 8.4%, and 3.4% was from hydropower and other renewables. Germany aims to source 80% of its energy from renewables by 2030.

#2- Energy efficiency investments are outshining renewables: Global asset managers including KKR & Co, Blackstone, and Brookfield are sidestepping investments in renewables projects and are instead earmarking bns of USD toward financing ventures in the energy efficiency sector, Bloomberg writes. While many developers are eying development projects in the downstream renewable energy industry, increasing power prices — even for wind and solar energy on the back of high interest rates and global supply chain disruptions — are seeing financiers ‘narrowly focused’ on the mostly untapped energy-efficiency investment market, Bloomberg quotes industry players as saying.

Why the turn? The global energy efficiency market currently stands at some USD 310 bn annually and investments are intincing in the wake of the energy crunch exacerbated by the Russia-Ukraine war, prompting consumers to streamline operations and identify energy slashing pockets, Bloomberg notes. The global industrial energy efficiency market is poised to reach USD 41.21 bn by the end of the decade.

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CIRCLE YOUR CALENDAR-

Qatar will host The International Conference on Smart Grid and Renewable Energy is kicking off Tuesday, 9 January through to Friday, 12 January in Doha. The conference will explore smart grid and renewable energy resources and related technologies. Look for discussion of power electronics, controls, manufacturing, communications, and computational intelligence.

Saudi Arabia will host the Future Minerals Forum from Tuesday, 9 January through to Thursday, 11 January in Riyadh. The event will focus on resource-rich regions of Africa, Western Asia, and Central Asia and will include a ministerial roundtable with over 60 countries being represented. A parallel exhibition will have some 150 exhibitors and industry sponsors on site.

The UAE will host the Management and Sustainability of Water Resources Conference from Monday, 26 February to Wednesday 28 February in Dubai. Water availability in arid and semiarid regions, global water issues, and future water and environmental challenges are all on the agenda.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

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2

SOLAR

Acwa Power begins commercial operations on Sudair solar plant’s third and final phase

Sudair plant kicks off operations on third phase: Acwa Power received the commercial operation certificate to begin operating the third and final phase of its 1.5 GW Sudair solar project in Saudi Arabia from the Saudi Power Procurement Company (SPPC), according to a Tadawul filing. This phase adds 25% of the total project, achieving its full operating capacity. The company expects the impact to be reflected in its 1Q financial statements.

REMEMBER- This has been in the works: Acwa Power began commercial operations of 75% of the Sudair project in November after receiving the commercial operation certificate from SPPC and expected the impact of the 1.125 GW in operation to be reflected in its 4Q financial statements.

About Sudair: The project is set to become one of the largest single-contracted solar PV plants globally and the largest of its kind in Saudi Arabia. It is the first project under the Saudi sovereign wealth fund’s renewable energy program, and has recorded the second-lowest cost globally for solar PV electricity production at USD 1.239 cents/kwh. Once fully operational, the renewable energy program aims to deliver 70% of the kingdom’s renewable energy goals, according to Acwa Power. Acwa Power and Water and Electricity Holding Company (Badeel) each hold a 35% stake in Sudair, and an Aramco subsidiary owns the remaining 30%.

Acwa has more in the bag: The company plans to officially start its largest China operations thisquarter, building on previous purchases from China of products worth USD 30 mn in the energy, water, and green hydrogen sectors.

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3

COFFEE WITH..,

Coffee with Zach Faizal, founder of Peec Mobility

Coffee with: Zach Faizal, founder of Peec Mobility: Faizal (LinkedIn) founded EV startup PeecMobility in 2019 to help the region avoid the mass scrapping of existing internal combustion engine vehicles and lessen the need to manufacture new electric vehicles to replace them. Peec says its tech costs 30% less and requires 80% less manufacturing time than its new counterparts. The EV startup unveiled the UAE’s first petrol-to-electric repurposed vehicle during COP28 last month.

We had a brief chat with Faizal about how Peec’s EV repurposing technology works, how it can benefit the growing EV industry across different markets, the company’s recycling strategies, industry challenges with the supply chains, and possible future agreements for expansion.

Edited and condensed excerpts of our conversation follow.

Enterprise: How does Peec’s EV building process work?

Zach Faizal: The concept is very simple. We bypass the most complex part of the manufacturing — the chassis — and produce electric cars by reusing the chassis and adding in battery packs, the software that runs the cars, and all of the other mechanical components that need to be fitted into the existing chassis.

We have 1.6 mn cars on the road, and a lot of these chassis have been made for the past century or so by big reputable original equipment manufacturers, so they last for 25 to 30 years. That's why you still see cars on the road from the 80s and 90s that are still perfectly fine on the road.

Bee’ah is our strategic partner for all of the projects that we carry out and they own one of the biggest recycling plants in the region. They will recycle all of the components that we remove from the existing vehicles and the battery packs that are brought back after their end-of-life, thereby closing the full circular economy with them.

E: Have you faced any supply chain issues?

ZF: One of the values that we bring to the table in this part of the region is that we develop our battery packs, so we don't buy battery packs from abroad. We buy the cells and we convert them to packs here, eliminating some supply chain issues. We also have very strong supply partners on board as well, so fortunately we haven't had any issues with the supply chain.

E: Any plans to expand outside the UAE?

ZF:We've been working with multiple governments around the world because our tech is scalable and can apply to any major city. We've been in talks with the Italian Transportation Ministry and with the UK government to repurpose their public buses to electric and we started building prototypes for that. We're also looking at some of the developing markets like Kenya, which is very interested in the technology. We will deploy the initial set of vehicles in the UAE by the end of 2024, then start looking to expand to other geographies.

We're in the process of fundraising as we speak. Over the next couple of months and once we secure the final round of investment, we will be announcing who the official investors are.

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4

MACRO PICTURE

Fewer than 4% of global engineering firms have confidence in their climate resilience skills, IET survey finds

Less than 4% of global engineering firms have confidence in their climate resilience skills, according to an international survey by the Institution of Engineering and Technology (IET), which surveyed engineering employers in eight countries. While nearly 90% of the surveyed firms have seen their bottom lines take a hit due climate-driven supply chain disruptions, almost all organizations said their specialist environmental and leadership skills are not adequate to meet their net zero targets.

Findings: There are mixed opinions across the surveyed markets on which skills are most needed for climate resilience, from technical and engineering skills to softer skills like whole systems thinking. Developing countries including China, Malaysia, Egypt, Saudi Arabia, India, and Brazil believe their climate resilience capacity is highly inadequate. Surveyed engineering firms in China and Malaysia said they have 1% of required resiliency skills, while Egypt and Brazil said they have 3% and Saudi Arabia 2%. Developed countries did not fare much better, with Germany and the US each noting 4%, and Australia and the UK sitting at 7% and 10% respectively.

Goals in place, but upskilling needed: IET’s research also found that while 67% of surveyed organizations have formulated sustainability goals — partly to meet entry requirements for new markets — 75% of respondents say they still need to upskill their workforce and boost knowledge transfer, especially on specialist sustainability technical skills to to realize their targets.

China is leading the pack: The majority of surveyed firms — except for those in the UK — believe their countries’ education systems are capable of equipping the next generation of engineers with the necessary climate resilience skills, with 95% of respondents from China noting their education pipeline adequately prepares younger people for the sector.

More academic collaboration needed: Engineering employers overwhelmingly see collaboration with academia as essential to graduating proficient engineers, and all surveyed organizations — except those in Egypt — see collaboration programmes between academia and the private sector as critical to delivering quality tech leaders.

What they said: “To help meet national net zero targets, businesses are telling us that they want to see their governments focusing their policies on economic development and industrial strategy, as well as closer collaboration between academia and industry to ensure more high-quality engineering and technology candidates are ready for industry,” IET President Gopichand Katragadda noted last month.

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5

ALSO ON OUR RADAR

KSA’s SPWC opens tender for more desalination plants and Al-Futtaim partners with e& on EVs

MORE DESALINATION IN KSA-

SWPC issues tenders for Jubail 4 and 6: The Saudi Water Partnership Company (SWPC) has issued tenders to the pre-qualified bidders for the Jubail 4 & 6 Independent Water Projects (IWP), which will have a total capacity of 600k cu m/day, Trade Arabia reports. The tenders include the finance, development, operation, and maintenance of the seawater reverse osmosis (SWRO) desalination water project in Jubail Industrial City. The plant will be located next to the existing plant units — Jubail Phase 1, Jubail Phase 2, Jubail 3A and 3B. The projects will start commercial operations in 3Q 2027. The successful bidder will develop the project and then sell the capacity and output to SWPC under a 25-year water purchase agreement.

The bidders: SWPC said nine utility developers, including two in consortiums, had qualified for the project last September, the report adds. These include Abu Dhabi National Energy Company, Acciona Agua, Acwa Power, and Engie.

REMEMBER- Not KSA's first reverse osmosis plant: Acwa Power, Gulf Investment Corporation (GIC), and Al Bawani Water and Power Company inaugurated in June the solar-powered Jubail 3A independent water desalination plant, which uses reverse osmosis technology.

ELECTRIC VEHICLES-

Al-Futtaim Electric Mobility Company and e& will partner to deploy a fleet of 100 BYD electric vehicles in the UAE, according to a statement. The BYD Atto 3 vehicles have a range of 420 km on a single charge and will be integrated into e&'s fleet in a phased rollout in a bid to achieve e&'s netzero commitments covering Scope 1 and 2, by 2030.

REMEMBER- Al-Futtaim is big on green mobility: Al-Futtaim Toyota said it intends to supply taxi franchise company Cars Taxi’s vehicle fleet with 1.3k Toyota Camry hybrid vehicles last November. Al-Futtaim Trading Enterprise will also roll out Volvo’s all-electric EX30 SUV in the UAE this month.

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6

CLIMATE IN THE NEWS

Climate change will cost the Panama Canal USD bns annually

Preserving the Panama Canal’s capacity to accommodate vessels amid a long lasting drought could take years and cost bns of USD, Bloomberg reports. The canal is facing unprecedented water shortages at levels 1.8m below average, limiting the number of vessels able to cross each day. Pre-drought capacity permitted 38 ships per day, while authorities have now capped it at 24, with the number expected to drop further as the dry season approaches.\

Bigger business for Egypt’s Suez Canal? Climate-driven water scarcity in Central America drove the Panama Canal Authority to mandate that shipping vessels decrease their payloads last May, driving freight ship traffic to Egypt’s Suez Canal.

There’s no quick fix: The canal authorities are considering using an artificial lake to pump water into the canal or boosting rainfall through cloud seeding but both options would take years to implement, Bloomberg writes. In the meantime, the canal will use water from a secondary reservoir, Lake Alajuela, until rain picks up in May. Panama is exploring damming up the Indio River as a long-term option — a costly and controversial project that faces local opposition from farmers.

What does this mean for global trade? The canal is responsible for roughly USD 270 bn a year in global trade, and restrictions put in place since August 2023 have impacted the 170 countries that use the canal to transport key goods. The Evergreen Marine ship — which was scheduled to set a record for carrying the most containers through the Panama Canal — was forced to unload thousands of containers after the canal authority reduced maximum ship weights.

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7

ON YOUR WAY OUT

Iran’s ‘desert gold’ saffron industry is drying up due to climate change

Droughts are battering Iranian saffron fields: Iran, the world’s largest producer of saffron, is facing a crisis in its saffron industry as climate change and water shortages take a toll on its crocus fields in Torbat-e Jam, The Financial Times writes. The spice farmers are struggling to cope with the effects of changing weather patterns, which have brought freezing winters, dry springs, and scorching summers that have dried up all 2k surface water wells in the region.

Saffron supplies are dwindling: The total production of saffron is expected to fall to about 170 tons this year from nearly 400 tons last year, the report notes. The decline in supply has dramatically driven up the domestic and international prices of saffron, which is already the most expensive spice in the world. A kilo of premium saffron can cost up to USD 1.8k, according to suppliers.

Why is saffron so expensive? Saffron is a labor-intensive spice that requires hand picking and drying the stigmas of the crocus sativus flower — up to 170k flowers are needed to produce 1kg of saffron.

Demand is also dropping: Iran is struggling with an inflation rate above 40%. This has caused the domestic consumption of the spice, which accounts for about a quarter of annual production, to drop. The saffron industry is also suffering from the impact of US-led sanctions over Iran's nuclear programme, which has restricted its access to the global financial system and fuelled smuggling. China, which snaps up 45% of Iran’s saffron crop, has also reduced its imports due to the price surge.

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CALENDAR

JANUARY 2024

8-10 January (Monday- Wednesday): International Conference on Smart Grid and Renewable Energy, Doha, Qatar.

8-9 January (Monday-Tuesday): Sustainability Forum Middle East, Manama, Bahrain.

9-11 January (Tuesday-Thursday): Future Minerals Forum, Riyadh, Saudi Arabia.

20-24 January (Saturday- Wednesday): ASHRAE Winter Conference, Illinois, USA.

FEBRUARY 2024

26-28 February (Monday-Wednesday): Management and Sustainability of Water Resources, Dubai, UAE.

MARCH 2024

4-6 March (Monday-Wednesday): International Conference on Sand and Dust Storms in the Arabian Peninsula, Riyadh, Saudi Arabia.

APRIL 2024

16-18 April (Tuesday-Thursday): World Future Energy Summit, Abu Dhabi, UAE.

16-18 April (Tuesday-Thursday): Middle East Energy, Dubai, UAE.

23-25 April (Tuesday-Thursday): Connecting Green Hydrogen MENA, Dubai, UAE.

30 April-2 May (Tuesday-Thursday): Autonomous E-Mobility Forum, Doha, Qatar.

MAY 2024

7-9 May (Tuesday-Thursday): Global Waste Forum, Algiers, Algeria.

19-21 May (Sunday-Tuesday): Saudi Energy Convention, Riyadh, KSA.

JUNE 2024

5 June (Wednesday): World Environment Day, Saudi Arabia.

OCTOBER 2024

15-17 October (Tuesday-Thursday): EV Auto Show, Riyadh, KSA.

DECEMBER 2024

2-13 December (Monday-Friday): Conference of the Parties (COP16) to the United Nation Convention to Combat Desertification, Riyadh, KSA.

EVENTS WITH NO SET DATE

2024

Early 2024: The 2023 US Algeria Energy Forum, Washington DC, USA.

12-14 February (Monday-Wednesday): Sustainable Aviation Futures MENA Congress, Dubai, UAE.

End-2024: Emirati Masdar’s 500 MW wind farm in Uzbekistan to begin commercial operations.

QatarEnergy’s industrial cities solar power project will start electricity production.

2025

International Union for Conservation of Nature World Conservation Congress, Abu Dhabi, UAE.

UAE to have over 1k EV charging stations installed.

2026

26-29 October (Monday-Thursday): World Energy Congress, Riyadh, Saudi Arabia.

UITP Global Public Transport Summit, Dubai, UAE.

Annual Meetings of the World Bank and the International Monetary Fund, Bangkok, Thailand.

1Q 2026: QatarEnergy’s USD 1 bn blue ammonia plant to be completed.

End-2026: HSBC Bahrain to eliminate single-use PVC plastic cards.

2027

MENA’s district cooling market is expected to reach USD 15 bn.

2030

UAE’s Abu Dhabi Commercial Bank (ADCB) wants to provide AED 35 bn in green financing.

UAE targets 14 GW in clean energy capacity.

Tunisia targets 30% of renewables in its energy mix.

Qatar wants to generate USD 17 bn from its circular economy, creating 9k-19k jobs.

Morocco’s Xlinks solar and wind energy project to generate 10.5 GW of energy.

2035

Qatar to capture up to 11 mn tons of CO2 annually.

2045

Qatar’s Public Works Authority’s (Ashghal) USD 1.5 bn sewage treatment facility to reach 600k cm/d capacity.

2050

Tunisia’s carbon neutrality target.

2060

Nigeria aims to achieve its net-zero emissions target.

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