Energy management, in my mind, is one of the greatest challenges we face … as well as one of the greatest opportunities. is the basis of economic sustainability, and can be a key source of competitive advantage. The proper management of our energy resources can make the difference between a consuming wasteful economy and a growing productive one.
We here in the Gulf are at a cross-roads. We have witnessed unprecedented growth in our economies in recent years, but this has also been accompanied by some of the highest energy intensity rates in the world. Fortunately, visionary leaders in the region have realized the importance of energy management, and have begun to put in place plans to rein in excessive consumption, as well as introduce efficiency technologies.
Today we hear of uncertainty surrounding the future of energy in this world. I believe we must undertake a realistic assessment of the current situation. We must adopt a pragmatic approach that recognizes the tremendous role of our traditional energy sources, and the great future potential for their performance and efficiency, while at the same time increasing the viability of alternatives. We must be willing to make the timely and extensive investments required. And we must commit ourselves to working collaboratively rather than at cross purposes.
There are indeed a number of proven energy efficiency technologies and promising alternative energy sources, and with time these will certainly grow and develop. In my view, this is not only desirable but in fact necessary, given the large projected growth in total worldwide energy demand.
In fact the challenge for energy efficiency in the region is not the viability, technical or economic, but rather the practical challenge caused by the absence of market incentives due to energy subsidies. These subsidies were well-intentioned efforts to support those most needful, and to accelerate the growth of economies in earlier times. Today, they lead to excessive consumption and suboptimal investment. We must work together to find means of overcoming this lack of incentives, and attract the investment which will surely pay back many times over.
Indeed, we at Saudi Aramco are actively investing in the development of energy efficiency. As you already know, Saudi Aramco is the main supplier of energy in Saudi Arabia and the top oil producer in the world. For the last three decades, the demand on energy has increased dramatically.
Since its early days, Saudi Aramco has been well aware of the importance of the efficient utilization of the resources it produces. Accordingly, Saudi Aramco has launched several initiatives with the aim of improving the utilization of energy through the use of cost effective innovative solutions and efficient resource management practices.
For example, over the past ten years, Saudi Aramco developed its successful platform of cogeneration plants that has become a standard for optimal design of any new Saudi Aramco facilities. Cogeneration technology relative to conventional steam and power generation is far more efficient. This technology produces power and steam using less fuel with higher efficiency and producing less pollutants. Cogeneration technology has a thermal efficiency of more than 80% compared to conventional generation of 40-50% thermal efficiency.
In terms of renewable energies, Saudi Aramco has developed one of the largest carport solar photovoltaic systems with a size of 10MW covering our parking lots surrounding the state of the art 13 story offices’ building located in our headquarter in Dhahran.
In addition, Saudi Aramco has established its Saudi Aramco Energy Ventures subsidiary (SAEV) with the mission to invest globally into start-up and high growth companies with technologies of strategic importance to Saudi Aramco and to accelerate their development and their deployment in the Kingdom. One of the key technologies that SAEV is focusing on is the renewable and energy efficiency technologies.
We see these technologies playing an important role in the Kingdom and the region, and we want Saudi Arabia to be a global leader not only in petroleum but in energy in general.
We're also pleased that other neighboring countries are developing promising projects in the energy efficiency field and alternative technologies and we would like to collaborate to benefit and learn from the success stories.
Ahmad Al-Khowaiter is Chief Engineer and Head of Business Development at Saudi Aramco. He prepared this commentary for March 2014 issue of Al-Bia Wal-Tanmia magazine, based on his statement at the Gulf Energy Management Conference in Bahrain in December 2013.