Gulf Countries to Save Minimum of $300m to $1bn Per Year with Smart Grid
WASHINGTON, June 4, 2012 /PRNewswire/ — The Middle East & North Africa (MENA) region is in the early stages of its smart grid development but stands to realize strong benefits, including minimum savings of $300 million to $1 billion per year for Gulf countries. Smart grid is an opportunity for MENA countries to incorporate their vast solar and renewable resources, manage growing demand, reduce carbon emissions and cut down on electricity system losses, according to a new study released today by Northeast Group, LLC.
The new study ‘Middle East & North Africa Smart Grid: Market Forecast (2012-2022)’ projects the smart metering market will reach 16.1 million units by 2022 with cumulative capital expenditure of $3.9 billion. The majority of near-term activity will be in the Gulf region, where Saudi Arabia and the United Arab Emirates are currently leading the way. By 2022, 86% of homes and businesses in the Gulf countries will have smart meters. Other MENA countries outside the Gulf will develop at a slower pace – due largely to political risk – but represent larger market sizes and also stand to realize strong benefits from smart grid technologies.
“All countries in the MENA region are facing high rates of electricity demand growth, and the Gulf countries have some of the highest levels of per capita electricity consumption and carbon emissions in the world. Demand side management is becoming increasingly important in these countries and smart meters will be an important tool in these efforts. By implementing smart metering, a conservative estimate is that Gulf countries could save a minimum of between $300 million to $1 billion per year on oil and natural gas used for electric generation. The actual savings could be much higher. Countries could then turn these savings into increased oil and gas exports,” according to Northeast Group.
“MENA countries are also aggressively pursuing renewable sources of energy, highlighted by Saudi Arabia’s recent announcement that it is aiming to spend $109 billion to develop 41 GW of solar capacity over the next 20 years. Smart grid technologies will be instrumental in helping these countries incorporate intermittent renewable resources,” according to Northeast Group.
Governments of several MENA countries are experimenting with a number of policies to help curb domestic consumption of fossil fuels, including feed-in tariffs for renewables, conservation outreach campaigns, and electricity pricing mechanisms that more closely reflect the costs of electric service (regional electricity prices are currently among the lowest in the world). Several high profile transmission interconnection initiatives are also helping these countries to use their systems more efficiently.
“Smart grid regulatory frameworks are in the early stages of development but progress is being made,” Northeast Group added. “Governments are realizing they must incentivize energy conservation and are beginning to invest in the technologies necessary to make their grids smarter. Smart city concepts such as Masdar City in the UAE and the Pearl-Qatar in Qatar show that smart grid technologies will be a feature of Gulf infrastructure investments over the next decade.”
Northeast Group forecasts 5 segments of the smart meter – or advanced metering infrastructure (AMI) – market, including meter hardware, communications, IT, professional services, and installation services for 12 countries across the MENA region. In addition to smart meter market forecasts, the report covers distribution automation activity, wide area measurement initiatives and home energy management. The report also highlights the positioning of domestic and international smart grid vendors in the region. Countries profiled in the study include:
- Saudi Arabia;
- United Arab Emirates.
Northeast Group’s report is 119 pages long and includes over 70 charts, tables and graphics. The report was completed using both primary and secondary sources in the MENA region. To order a copy of the report, please visit www.northeast-group.com or email Ben Gardner at: email@example.com
ABOUT: Northeast Group, LLC is a Washington, DC-based smart grid market intelligence firm. Our research is focused on the smart grid opportunity in emerging market countries.
Key questions answered in this report:
- How large will the smart meter market – including 5 segments – in MENA become over the next decade?
- Which countries are developing smart grid regulatory frameworks and what do they look like?
- Which international vendors are already active in MENA? How will rules on local participation affect international investment in the smart grid market?
- Which communications technologies will be favored by utilities in the MENA region?
- How will the development of renewable sources of energy affect smart grid in the MENA region?
- What pilot projects are in place and what hurdles have they faced?
- How will recent political events in the region shape smart grid development?
Table of Contents i. Executive Summary 1 ii.Methodology 8 1. Introduction 10 1.1 What is smart grid? 10 1.2 Smart grid's role in regional interconnection 17 1.3 How has smart grid been used elsewhere in the world? 21 2. MENA smart grid snapshot 25 2.1 The region in comparison 26 2.2 Regional drivers 29 2.3 Regional challenges 33 2.4 Most recent developments 35 3. Regional market forecast 37 4. United Arab Emirates 41 4.1 Electricity industry structure 41 4.2 Smart metering regulatory environment 43 4.3 Market forecast 46 4.4 Utility activity 48 5. Saudi Arabia 52 5.1 Electricity industry structure 52 5.2 Smart metering regulatory environment 56 5.3 Market forecast 58 5.4 Utility activity 60 6. Qatar 62 6.1 Electricity industry structure 62 6.2 Smart metering regulatory environment 65 6.3 Market forecast 66 6.4 Utility activity 68 7. Oman 70 7.1 Electricity industry structure 70 7.2 Smart metering regulatory environment 73 7.3 Market forecast 74 7.4 Utility activity 75 8. Kuwait 77 8.1 Electricity industry structure 77 8.2 Smart metering regulatory environment 80 8.3 Market forecast 80 8.4 Utility activity 81 9. Bahrain 83 9.1 Electricity industry structure 83 9.2 Smart metering regulatory environment 86 9.3 Market forecast 86 9.4 Utility activity 88 10. Beyond the Gulf 89 10.1 Market drivers and barriers 89 10.2 Jordan 92 10.3 Egypt 94 10.4 The rest of the region 95 11. Vendor activity 99 11.1 Domestic vendors 100 11.2 International vendors active in smart grid in MENA 102 11.3 International vendors poised to expand in MENA 105 12. Conclusion 107 13. Appendix 108 13.1 List of companies mentioned in this report 108 13.2 List of acronyms 109
List of Figures, Boxes, and Tables MENA smart grid: key takeaways 2 Smart grid development in Gulf countries 6 AMI forecast by country 7 AMI forecast data by country 7 Figure 1.1: Smart grid value chain 10 Figure 1.2: Smart grid model highlighting focus in MENA 11 Table 1.1: Benefits of AMI in the Gulf 14 Table 1.2: Demand response options 16 Figure 1.3: GCC Interconnection 17 Figure 1.4: Proposed European "super grid" 19 Figure 1.5: Smart grid activity in emerging markets 22 Figure 2.1: Emerging markets smart meter potential 26 Figure 2.2: Per-capita electricity consumption 27 Figure 2.3: Per-capita CO2 emissions 27 Figure 2.4: GDP growth in MENA and the Gulf 28 Table 2.1: Smart grid market drivers and barriers in the Gulf 29 Figure 2.5: Per-capita consumption in MENA 30 Figure 2.6: Renewable sources of energy in MENA 31 Figure 2.7: Distribution losses in MENA 32 Figure 2.8: Electricity prices in MENA 34 Figure 3.1: Timeline of smart grid developments in MENA 37 Figure 3.2: AMI forecast by country 38 Table 3.1: AMI forecast data by country 38 Figure 3.3: MENA smart meter penetration rate 39 Figure 3.4: Gulf smart meter penetration rate 39 Figure 3.5: AMI cost breakdown 39 Figure 3.6: AMI forecast by segment 40 Table 3.2: AMI forecast data by segment 40 Figure 4.1: UAE AMI penetration rate 41 Table 4.1: Smart grid indicators in the UAE 42 Figure 4.2: Voluntary dynamic pricing in Abu Dhabi 44 Box 4.1 Political risk in the UAE 45 Figure 4.3: UAE AMI forecast 47 Table 4.2: UAE AMI forecast data 47 Box 4.2: Masdar City-a carbon neutral smart city 49 Figure 5.1: Saudi Arabia AMI penetration rate 52 Table 5.1: Smart grid indicators in Saudi Arabia 53 Box 5.1: Political risk in Saudi Arabia 55 Figure 5.2: Saudi Arabia AMI forecast 59 Table 5.2: Saudi Arabia AMI forecast data 59 Figure 6.1: Qatar AMI penetration rate 62 Table 6.1: Smart grid indicators in Qatar 63 Box 6.1: Political risk in Qatar 65 Figure 6.2: Qatar AMI forecast 67 Table 6.2: Qatar AMI forecast data 67 Box 6.2: The Pearl Qatar project 68 Figure 7.1: Oman AMI penetration rate 70 Table 7.1: Smart grid indicators in Oman 71 Box 7.1: Political risk in Oman 72 Figure 7.2: Oman AMI forecast 74 Table 7.2: Oman AMI forecast data 74 Figure 8.1: Kuwait AMI penetration rate 77 Table 8.1: Smart grid indicators in Kuwait 78 Box 8.1: Political risk in Kuwait 79 Figure 8.2: Kuwait AMI forecast 81 Table 8.2: Kuwait AMI forecast data 81 Figure 9.1: Bahrain AMI penetration rate 83 Table 9.1: Smart grid indicators in Bahrain 84 Box 9.1: Political risk in Bahrain 85 Figure 9.2: Peak demand in Bahrain 86 Figure 9.3: Bahrain AMI forecast 87 Table 9.2: Bahrain AMI forecast data 87 Figure 10.1: Distribution losses in MENA 90 Figure 10.2: Jordan AMI penetration rate 92 Figure 10.3: Jordan AMI forecast 93 Table 10.1: Jordan AMI forecast data 93 Figure 10.4: Egypt AMI penetration rate 94 Figure 10.5: Egypt AMI forecast 95 Table 10.2: Egypt AMI forecast data 95 Table 11.1: Vendors based in the Gulf 99 Figure 11.1: International AMI vendors in MENA 103 Table 12.1: The next steps and necessary actions 107
Companies covered in this report
- ABB (Switzerland)
- Advanced Electronics Company (Saudi Arabia)
- ADWEA (UAE)
- Al Mostajed (UAE)
- Al Wataniya (Kuwait)
- Alstom (France)
- BPL Global (US)
- Consolidated Gulf Company (Qatar)
- Desertec (US)
- DEWA (UAE)
- Electricity Distribution Company (Jordan)
- Electricity Holding Company (Oman)
- Electricity and Water Authority (Bahrain)
- Elster (Germany)
- FEWA (UAE)
- GE (US)
- Global Energy Technologies (UAE)
- Gulf Investment Corporation (UAE)
- Irbid District Electricity Company (Jordan)
- Itron (US)
- Jordanian Electric Power Company (Jordan)
- Kahramaa (Qatar)
- Landis+Gyr (Switzerland)
- Larsen & Toubro’s (India)
- Masdar (UAE)
- Mubadala (UAE)
- National Trading Company (Oman)
- Oracle (US)
- QEWC (Qatar)
- Petra Solar (US)
- Saudi Aramco (Saudi Arabia)
- Saudi Electricity Company (Saudi Arabia)
- SEWA (UAE)
- Siemens (Germany)
- Sonelgaz (Algeria)
- Suez-Tractebel (Belgium)
- SWCC (Saudi Arabia)
- Technology Partners (UAE)
- Tropos Networks (US)
SOURCE Northeast Group, LLC