Wednesday, October 31, 2007

Sher Value: Alternative Energy

Back two decades ago there was a consensus that when oil prices were consistently above US$ 30 per barrel the move towards alternate energy would be spurned on to reach a commercially viable solution. Now with oil in the mid $80 range, and in my opinion set to eventually cross the $100 mark, it is surprising that alternate energy is not the hottest topic on the scene. Indeed a lot has been done in the past two decades and perhaps now we can see a major effort forward towards solar and other alternate forms of energy emerging on the market.

In the US work is underway for a 550 megawatt solar thermal generation plant in the Mojave Desert, which will provide power to over 400,000 homes. In addition Spain, Morocco, India, Iran and others have solar power generation projects underway, which produce anywhere from 30 MW to 354 MW of power. While such power plants will not be the suppliers for huge industrial consumers they will take the place of valuable conventional power generation. Just imagine if all the homes in UAE could get their power needs from alternate energy.

We also have to consider that sooner or later the use of nuclear energy will be a cleaner and more efficient way of mass power generation in the future. Thus it is not far from conceivable that in the coming years perhaps countries like UAE and Qatar will consider nuclear power plants to replace the conventional energy generation. This will mean that the current myopic view of nuclear energy will have to change, and with the right safeguards should actually be encouraged.

It is also clear that with the current concern for the environment and global warming the impetus for alternate energy sources will gather pace. It is inevitable that we will have to consider a wide variety of generation needs, and indeed the government should consider incentives for those businesses who deploy clean, safe and efficient alternate energy systems.

The current predictions are that solar power generation will become more efficient and while today it would cost 15 cents pr Kilowatt hour it is estimated that within a couple years, and as more systems are deployed, the cost will come down to 7 cents per KWh, making solar energy very competitive with the oil and gas fired traditional power generation technologies.

We are at the point where alternate energies can be sustainable and to do this we need to create an encouraging atmosphere and this where a major effort towards legislation and financial support should be considered. This is the right way forward and nothing could be more positive than an oil producing country to also embrace the idea of solar and other alternate forms of energy. Interestingly, UAE is making a commitment to go Green and also is one of the countries listed as the most suitable for generating solar energy. Lets do something about this.

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