UAE has helped solar energy prices drop globallyby Jumana Abdel-Razzaq on Jan 31, 2017
The UAE has contributed significantly to making the price of renewable energy cheaper to produce, according to a Japanese study.
The report, compiled by Japan’s Nikkei, highlighted that bid prices for solar and wind power projects in Europe and the Middle East have dropped to levels comparable to coal-fired thermal power.
Dubai Electricity and Water Authority, DEWA, alone received bids in the range of $2 cents per kilowatt-hour in proposals for solar projects, teaming up with Abu Dhabi’s clean energy company Masdar as well as other companies to build solar plants and wind farms in the UAE and abroad, according to WAM.
Long sunlight hours in the Middle East also helps ensure stable production of solar energy in the region at a lower cost.
According to the report: "Renewable energy has been costly in the past, but many countries began to subsidise it in the 2000s in an effort to fight global warming and diversify their energy sources.
“This has helped the costs of equipment and construction to decrease as the market expands, and making number of Western companies in such fields as information technology have begun buying all their energy from renewable sources as prices fall.”
Offshore wind power also has the potential to become a stable energy source with more being invested in areas such as the North and Baltic Seas.
Earlier this month, Masdar announced that it has taken a 25% stake in Hywind Scotland, a 30 megawatt floating offshore pilot wind farm in the North Sea, due to be completed this year.
This project will push Masdar’s total UK investments above 1 gigawatt of power, which is enough electricity to supply 6,600 homes.
Data from the International Energy Agency, IEA, has also shown that solar energy production costs have dropped 80% in the last five years while onshore wind power costs have fallen by nearly 70%.
Onshore wind power costs have fallen below $10 cents per kilowatt-hour while coal-fired thermal power typically goes for $5-7 cents per kilowatt-hour.