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Energy Management

Smart Cities to facilitate a Sustainable Energy Future

Change is permeating the energy sector globally and this is particularly evident in the Middle East and North Africa (MENA) region. Demographics (30% of the population is aged 15-29 years old according to the Brookings Institution, a US based think tank), urbanization and disruptive technologies have given rise to the corresponding needs of sustainable economic growth, smart cities planning and transformative change in the energy sector.

A key pillar of most countries in the region is the objective of energy diversification to underpin sustainable future economic growth.

One of the first and most important steps towards diversifying an economic system is investment in the research & development (R&D) base. This includes setting up universities and institutes which are not just able to keep up with technologies, but also to innovate for the future. Masdar institute is an example where there is active research in areas such as machine learning and nano-technology as part of its focus on sustainable development. Utilities in the region, including DEWA for example are in the process of establishing their own innovation functions and centers of excellence.

Another step is the ability to make investment decisions that advance a country’s economic growth. This may include investments in developing cutting edge industrial capabilities.  Examples here would be solar panel factories established in the Kingdom of Saudi Arabia, such as GTek Solar or QSTec in Qatar whose mission is to manufacture polysilicon and solar modules. Many countries in the region have also developed (or are developing) energy efficiency programs with a view to enable private sector companies establish sustainable building related industries, to build zero net energy building or retrofit currently existing buildings.

R&D combined with access to locally trained labor and industrial capacity is the basis for an industrial and economic transformation to a sustainable energy future. A growing sustainable and renewable energy industry will facilitate further gains in employment and growth opportunities for the young population pool in the region, thus achieving significant economic benefits for the entire nation.

With massive urbanization (the United Nations Development Program has projected that the total world population living in urban cities will increase from 54% to 66%; an increase of over 2 billion people) and disruptive technologies we are seeing the rise of Smart Cities, with Dubai vying to become the smartest, and new giant developments such as the King Abdullah Economics City (KAEC) in Saudi Arabia. Cities are taking advantage of the energy industry transition by leveraging the energy cloud; a move away from the traditional centralized power generation model to one that allows more choices on how energy is generated (distributed renewable), delivered and used.

Cities are working with utilities to develop new energy strategies that are distinctly urban and aiming to accelerate energy efficiency programs. Strong energy efficiency programs allow cities to use less energy and water, and tools such as retrofitting; rebate programs (as in the US) or energy service company (ESCO) models can help them achieve it.

The MENA region is witnessing an interesting shift in economic and policy focus and that is the emerging energy-water nexus. Significant parts of the Middle East are dependent on desalinated water for consumption purposes as well as electricity generation; until recently this has been a co-generated product. On the consumption side and the production side there is a growing trend towards assessing the interdependency of both resources from a planning and demand side management perspective.

In summary, there is a disruptive change upon the world’s power systems including the MENA region. Demography, urbanization and disruptive technologies are giving rise to the need for Smart Cities. Smart Cities are the hubs of the new energy and water business models that will emerge to cope with this transformative change for a more sustainable energy future.

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