1. Transforming the GCC Power Sector
Frank Wouters

2. content EU-GCC Clean Energy Network Global Trends and Issues
Electricity Sector
Flexibility
Power in the GCC

3. EU-GCC Clean Energy Network1
EU-GCC Clean Energy Network

4. The Network at a Glance
We catalyze and coordinate cooperation on clean energy
We support the development of partnerships in the area of clean energy technologies:
Renewable Energy Technologies;
Energy Efficiency and Demand Side Management;
Clean Fossil Fuels and related technologies;
Carbon Capture, Storage and Usage (CCS and CCU)
Regional Electricity Market Integration; and
Climate Change Policy.
2010 Creation
2016 Phase II

5. Trends and Issues 2

6. The World of Energy is Transforming Rapidly
Increasing
integration
of new technologies
Democratization
of the energy
system
New players
such as Google
and Tesla
New financial
instruments
such as Green Bonds
Rapidly falling
prices of renewables

7. Falling prices of solar panels

8. 2015 power prices in the Middle East
2.99 ct/kWh !
Source: NBAD “Financing the Future of Energy”

9. Moving to the Majority in New Capacity Additions
Worldwide, well over 100 GW of new renewable capacity has been added every year since That is equivalent to the total installed generation capacity of brazil, or twice that of Saudi Arabia. Renewables have accounted for more than half of net capacity additions in the global power sector since 2011 – meaning more reneawbles capacity is being installed than new capacity in fossil and nuclear power combined. More than half of the new electricity generation capacity worldwide is based on renewable energy.
Source: IRENA

10. Distorted Energy Pricing
Pre-tax Energy Subsidies and Spending on Education for each percentage point of GDP in MENA countries, 2011
Fossil-fuel subsidies divert spending from health,
education, more inclusive growth
Pre-tax subsidies are difference between what the consumer pays at the pump for gasoline vs. international prices. Tax subsidies are difference between energy tax and normal consumer tax. Should also include tax on pollution. Post tax subsidies are normally 4 times pre-tax subsidies but (e.g. MENA)

11. Electricity sector at a crossroads3

12. We can show similar pictures for wind energy and other renewables.

13. Average daily summer spot price profile in Germany, 2010 and 2013 (EUR/MWh)
On the short term there are already bad things happening for the incumbents in the electricity sector. In only three years spot prices have almost halved and according to the Deutsche Bank, 50% of the European profit pool will be gone by 2020.
Source: EEX; BNEF

14. Conventional Set-up Integrated Utility Consumers $ Generation
Transformation
Consumption
Transmission
Distribution

15. Unbundling Utility Utility Consumers Generation Transformation
Consumption
Transmission
Distribution

16. Privatization Utilities Utilities Consumers Generation Transformation
Consumption
Transmission
Distribution

17. Democratization Utilities Utilities Prosumers $ Generation
Transformation
Consumption
Transmission
Distribution

18. Impact on incumbents
Impact on incumbent utilities

19. RWE’ and EON’s share price

20. Flexibility 4

23. The future is flexible
The examples show the limitations of inflexible baseload in the new paradigm.
The challenge is to make it work in a new and much more complex system, enriched with non-traditional players and “prosumers”.

24. Power in the GCC 5

25. Power in the GCC IPP Model saves money in times of fiscal pressure
Increase solar and wind power
Integrate GCC grid and introduce wholesale market
Focus on efficiency, storage and demand side management
Reduce dependence on baseload power