Energy

DEWA adds eight 132 kV substations in Dubai

Transmission substations with solar panels

DEWA announces eight new 132 kV substations in Dubai, boosting capacity by 1,200 MVA for US$370mn, enhancing energy reliability and supporting urban growth. (Image source: Adobe Stock)

HE Saeed Mohammed Al Tayer, managing director and CEO of Dubai Electricity and Water Authority (DEWA), has announced the commissioning of eight new 132 kV transmission substations in the first half of 2024

These substations, with a total conversion capacity of 1,200 megavolt-amperes (MVA) and a combined cost of approximately US$370mn (AED 1.36 billion), are part of DEWA’s strategy to keep up with Dubai’s rapid development and urban growth. The projects also involved the installation of 89 kilometers of ground cables to further improve the efficiency of the 132 kV transmission network and address the rising electricity demand across the Emirate.

Dubai Energy Expansion

Al Tayer noted that some of these substations are designed to serve residential neighborhoods for Emirati citizens in Dubai, aligning with the integrated housing plan initiated by HH Sheikh Mohammed bin Rashid Al Maktoum, vice-president and prime minister of the UAE and Ruler of Dubai. This plan, launched by HH Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, chairman of the Executive Council of Dubai, aims to enhance living conditions in Emirati residential areas and boost social well-being.

“We continue our relentless efforts to achieve the goals of the National Strategy for Wellbeing 2031, and Dubai Social Agenda 33 to provide the best living experience and residential services that are suitable for all. We also work to enhance the reliability and availability of the energy network in Dubai utilising the latest disruptive technologies of the Fourth Industrial Revolution, smart technologies, and innovative practices across all our services and operations. This has contributed to achieving 100% in the reliability and availability of the energy transmission system in Dubai since 2018 and DEWA achieving the best performance among utilities worldwide. The total cost of DEWA’s electricity transmission network projects under construction exceeds US$1.36bn (AED 5 billion),” Al Tayer added.

The new substations were commissioned in the areas of Al Thanya 3, Al Barsha South 4, Wadi Al Shabak, Nadd Hessa, International City Phase 2, Wadi Al Safa 5, and Umm Suqeim 3. Completing these substations involved over 8 million safe working hours and employed the latest global digital technologies for transmission substations. This effort is part of DEWA’s commitment to advancing digital transformation across its services and operations, ensuring high standards of availability, reliability, efficiency, and safety.

As of the end of June 2024, the total number of transmission substations in Dubai has reached 382, including 27 400 kV substations and 355 132 kV substations. There are currently 31 132 kV transmission substations under construction, and DEWA is reviewing financial proposals for six new 132 kV substations. Over the next three years, DEWA plans to issue new tenders for the construction of more than 50 additional 132 kV transmission substations and extend 350 kilometers of ground transmission cables.

In addition, DEWA has awarded contracts for ten new 132 kV substations in various areas across Dubai, including Al Aweer 1, Umm Nahad 4, Al Manara, Umm Suqeim 2, Al Quoz Industrial 3, Hatta, Al Barsha South 3, Al Barsha 2, Wadi Al Safa 4, and Zabeel 2, with a total investment of approximately US$272mn (AED 1 billion). Contracts have also been awarded for extending 132 kV ground cables to connect these new substations to the main electricity transmission grid, totaling 25 kilometers and costing up to US$48mn (AED 176 million).

Global electricity demand to surge strongly

The IEA reports record global electricity demand growth driven by economic expansion, heatwaves, and tech adoption, with renewables set to surpass coal by 2025. (Image source: Adobe Stock)

According to a new report by the IEA, the world’s demand for electricity is rising at its fastest rate in years, driven by robust economic growth, intense heatwaves, and the increasing use of technologies that run on electricity such as EVs and heat pumps

The report, the IEA’s Electricity Mid-Year Update, forecasts global electricity demand to grow by around 4% in 2024, up from 2.5% in 2023. This would represent the highest annual growth rate since 2007, excluding the exceptional rebounds seen after the global financial crisis and the Covid-19 pandemic. The strong increase in global electricity consumption is set to continue into 2025, with growth around 4% again, according to the report.

Renewables surge ahead

Renewable sources of electricity are also set to expand rapidly this year and next, with their share of global electricity supply forecast to rise from 30% in 2023 to 35% in 2025. The amount of electricity generated by renewables worldwide in 2025 is forecast to surpass the amount generated by coal for the first time. Solar PV alone is expected to meet roughly half of the growth in global electricity demand between 2024 and 2025, with solar and wind combined meeting as much as three-quarters of the growth.

Despite the sharp increases in renewables, global power generation from coal is unlikely to decline this year due to the strong growth in demand, especially in China and India. As a result, carbon dioxide (CO2) emissions from the global power sector are plateauing, with a slight increase in 2024 followed by a decline in 2025. However, considerable uncertainties remain: Chinese hydropower production recovered strongly in the first half of 2024 from its 2023 low. If this upward trend continues in the second half of the year, it could curb coal-fired power generation and result in a slight decline in global power sector emissions in 2024.

Some of the world’s major economies are registering particularly strong increases in electricity consumption. Demand in India is expected to surge by a massive 8% this year, driven by strong economic activity and powerful heat waves. China is also set to see significant demand growth of more than 6%, due to robust activity in the services industries and various industrial sectors, including the manufacturing of clean energy technologies.

“Growth in global electricity demand this year and next is set to be among the fastest in the past two decades, highlighting the growing role of electricity in our economies as well as the impacts of severe heatwaves,” said Keisuke Sadamori, IEA director of Energy Markets and Security. “It’s encouraging to see clean energy’s share of the electricity mix continuing to rise, but this needs to happen at a much faster rate to meet international energy and climate goals. At the same time, it’s crucial to expand and reinforce grids to provide citizens with secure and reliable electricity supply – and to implement higher energy efficiency standards to reduce the impacts of increased cooling demand on power systems.”

With the rise of artificial intelligence (AI), the electricity demand of data centres is drawing increased attention, underscoring the need for more reliable data and better stocktaking measures. The report highlights the wide range of uncertainties concerning the electricity demand of data centres, including the pace of deployment, the diverse and expanding uses of AI, and the potential for energy efficiency improvements. Better collection of electricity consumption data from the data centre sector will be essential to correctly identify past developments and to better understand future trends.

Masdar's second green bond fuels renewable expansion

Masdar raises US$1bn through its second green bond issuance, advancing renewable projects in developing economies and aiming for 100GW by 2030. (Image source: Masdar)

Abu Dhabi Future Energy Company PJSC – Masdar, the UAE’s clean energy leader, has successfully raised US$1bn through its second green bond issuance under its Green Finance Framework

This comes a year after the company’s first issuance of US$750mn on the International Securities Market of the London Stock Exchange.

The issuance consists of two tranches of US$500mn each, with tenors of five and ten years and coupons of 4.875% and 5.25% respectively. There was strong demand from regional and international investors, with the order book reaching US$4.6bn, an oversubscription of 4.6 times. The final allocation split was approximately 70% to international investors and 30% to MENA investors.

Empowering green futures

The US$1bn proceeds from the issuance will fund Masdar’s equity commitments on new greenfield projects, many in developing economies, as the company aims for a target portfolio capacity of 100GW by 2030.

Masdar’s 2023 Green Finance Report, highlighting the delivery of its commitments under the Green Finance Framework, which has the highest possible rating from Moody’s of SQS-1, detailed the allocation and impact of its debut green bond. The proceeds have funded projects in emerging markets and the Global South with a total nominal capacity of 3.7 GW and are expected to mitigate 5.4 million tonnes of GHG emissions annually when fully operational.

Besides the green bond program, Masdar is acquiring operational companies in mature markets, injecting capital and expertise, significantly contributing to the global renewable energy capacity.

Mohamed Jameel Al Ramahi, CEO of Masdar, stated, “Following the successful launch of our first green bond in 2023, our second green bond issuance for US$1bn underscores investor confidence in Masdar’s financial robustness and its sustainability credentials. The funds will be pivotal in advancing our ambitious portfolio of renewable energy projects, further cementing our role as a key player in supporting an equitable energy transition by increasing energy access in emerging markets and the Global South.”

Mazin Khan, chief financial officer of Masdar, added, “As we have committed under our Green Finance Framework, we are raising green bonds and other green finance instruments to invest in new dark green projects. This is an important component of our investor relations story, but it is also a commitment that we are transparently fulfilling through the publication of our audited annual allocation and impact reporting. Few companies as strongly rated as Masdar offer investors bonds that can make such a positive impact across the ESG spectrum. Even fewer companies can tell investors exactly where every dollar of their money is going and its impact.”

Aligned with Masdar’s corporate credit ratings, this second issuance was rated AA- by Fitch and A2 by Moody’s. Fitch recently upgraded Masdar's credit rating to 'AA-', with a stable outlook, recognising the company’s financial strength and shareholder support, evidenced by their significant contributions to fund Masdar's growth ambitions.

The joint lead managers and bookrunners for the issuance were First Abu Dhabi Bank, Abu Dhabi Commercial Bank, Citibank, HSBC, Standard Chartered, Credit Agricole CIB, Natixis, and MUFG.

Envision Energy drives Middle East wind power

Envision Energy partners with Saudi PIF and Vision Industries to advance wind power in the Middle East, supporting sustainability goals. (Image source: Envision Energy)

Envision Energy, recognised as the "Green Giant" among the "2024 TIME100 Most Influential Companies," has announced a strategic joint venture (JV) with Saudi Arabia's Public Investment Fund (PIF) and Vision Industries

This venture aims to accelerate wind power growth across the Middle East, supporting the region's transition to a cleaner, more sustainable future.

Under the agreement, Envision Energy will hold the majority share in the JV, with PIF and Vision Industries holding the remainder. The focus will be on manufacturing and assembling wind turbines and components like blades, nacelles, and hubs. This initiative aligns with Saudi Arabia's ambitious goal to localize 75% of renewable energy components by 2030, as part of the National Renewable Energy Program led by the Saudi Ministry of Energy.

PIF, as one of the world's largest sovereign wealth funds, plays a pivotal role in Saudi Arabia's energy transformation strategy, investing in various renewable energy initiatives including wind power, photovoltaics, hydrogen, and energy storage. Vision Industries, known for its investment in green energy projects and local supply chains, brings valuable expertise to the JV.

Envision Energy was chosen for its leadership in green power technologies, including smart wind power, energy storage systems, and green hydrogen solutions. The company has been a top player in global wind power order intake for consecutive years, contributing significantly to the worldwide energy transition.

This partnership underscores international cooperation and a shared vision for advancing clean energy transitions globally. The ceremony announcing the JV was attended by key figures including H.E. Yasir Othman Al-Rumayyan, Governor of PIF, Lei Zhang, chairman of Envision, and board members of Vision Industries, highlighting the commitment to sustainable development and Saudi Arabia's Vision 2030 objectives.

Renewables target at risk: IRENA

IRENA warns of missing renewables target despite growth surge; global collaboration crucial for sustainable energy future. (Image source: IRENA)

The Renewable Energy Statistics 2024, released by the International Renewable Energy Agency (IRENA), highlight a critical challenge: While renewables are the fastest-growing power source, the world faces a potential shortfall in meeting the tripling renewables target pledged at COP28

To stay on track, the world will now need to increase renewables capacity by at least 16.4% annually through 2030.

The unprecedented 14% increase in renewables capacity during 2023 has established a compound annual growth rate of 10% from 2017 to 2023. Coupled with the declining additions of non-renewable capacity over the years, this trend suggests that renewable energy is on course to surpass fossil fuels in global installed power capacity.

However, if last year’s 14% growth rate continues, IRENA's target of reaching 11.2 Terawatts (TW) by 2030 under its 1.5°C Scenario will fall short by 1.5 TW, missing the target by 13.5%. Moreover, if the world maintains the historical annual growth rate of 10%, it will only achieve 7.5 TW of renewables capacity by 2030, falling short of the target by nearly one-third.

IRENA director-general Francesco La Camera emphasised, “Renewable energy has been increasingly outperforming fossil fuels, but it is not the time to be complacent. Renewables must grow at higher speed and scale. Our new report sheds light on the direction of travel; if we continue with the current growth rate, we will only face failure in reaching the tripling renewables target agreed in the UAE Consensus at COP28, consequently risking the goals of the Paris Agreement and 2030 Agenda for Sustainable Development.”

“Consolidated global figures conceal ongoing patterns of concentration in geography. These patterns threaten to exacerbate the decarbonisation divide and pose a significant barrier to achieving the tripling target,” he added.

COP28 president Dr Sultan Al Jaber stated, “That means increasing collaboration between governments, the private sector, multilateral organisations, and civil society. Governments need to set explicit renewable energy targets, look at actions like accelerating permitting and expanding grid connections, and implement smart policies that push industries to step up and incentivise the private sector to invest. Additionally, this moment provides a significant opportunity to add strong national energy targets in NDCs to support the global goal of keeping the 1.5°C target within reach. Above all, we must change the narrative that climate investment is a burden to it being an unprecedented opportunity for shared socio-economic development.”

Regarding power generation, the latest data for 2022 confirmed regional disparities in renewables deployment. Asia remains the global leader in renewable power generation with 3,749 Terawatt hours (TWh), followed for the first time by North America (1,493 TWh). South America saw a notable increase in renewable power generation by nearly 12% to 940 TWh, attributed to hydropower recovery and increased solar energy contribution.

Africa experienced a modest growth of 3.5%, reaching 205 TWh in renewable power generation for 2022, despite its substantial potential and urgent need for sustainable growth. Recognising this need, IRENA is advancing the Accelerated Partnership for Renewables in Africa (APRA) initiative and preparing an investment forum focused on APRA member countries later this year.

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