Qatar as the Middle East GDP per capita ranked first, one of the world's most promising photovoltaic power producers (annual solar power generation per unit of square meter is expected to be more than 2,000 kilowatt-hours), Qatar is rich in light resources, but highly dependents on fossil fuels to generate electricity, renewable energy installed capacity is only 800MW. Recently, Qatar has released a renewable energy strategy, although it still needs to wait for the details to come out. However, in terms of planning objectives, development mode and implementation pace, it has a high degree of realizability.
Focus on developing photovoltaics
According to the plan, Qatar will achieve a large-scale renewable energy capacity of about 4GW by 2030, mainly solar photovoltaics. The share of renewables has increased from the current 5% to 18%. In addition, the plan also proposes that Qatar increase its distributed generation capacity and install about 200MW of distributed solar power by 2030. Up to now, Qatar has only one 800MW installed solar photovoltaic power plant, the Alcazar power station, which has been put into operation in October 2022 and has been successfully delivered by Power China.
Electricity demand has grown significantly and is expected to reach 80TWh
According to QNRES, Qatar's electricity demand will grow from about 51 TWh in 2021 to about 80 TWh in 2040 due to economic growth and demographic changes. The significant increase in electricity demand underscores the importance of building sustainable and reliable energy infrastructure and shows that Qatar's 4GW target is relatively credible.
Emphasis on localization to maximize socio-economic benefits
The plan proposes to maximize the socio-economic benefits of renewable energy through the establishment of competitive local renewable energy sector players and the monetization of the environmental attributes of renewable energy projects. It is proposed to set "local content targets" to ensure that developers work with local EPCs and O&M companies when developing solar PV projects, to increase the local content of renewable energy projects and promote the development of the local renewable energy industry.
The specific initiatives are planned as follows:
1. Set feasible local content targets: Adopt policies to set minimum requirements for local content in renewable energy projects, such as stipulating that the proportion of local enterprises in EPC and O&M must not be less than a certain percentage.
2. Clarify regulatory and compliance requirements: Supervise developers to ensure that they meet local content targets in project development and operation and impose penalties on non-compliance.
3. Formulate policies for local business participation: Formulate policies to encourage developers to give priority to local enterprises for cooperation and provide more opportunities for local enterprises to participate in projects.
4. Establish a local enterprise certification system: Establish a certification system to certify local enterprises that meet the qualification requirements, issue certificates to EPC and O&M companies that meet the minimum capability threshold and recommend them to developers as partners.
5. Provide support policies for local enterprises: help local enterprises improve their technical level and competitiveness through financial support, tax incentives, financing facilitation and other policies.
6. Establish an information sharing platform: Establish an information sharing platform so that developers can more easily understand the situation of local enterprises, and at the same time promote exchanges and cooperation between local enterprises.
Supporting local enterprises to participate in the development of renewable energy
From the perspective of planning, the Qatari government is very aware of the importance of improving the competitiveness of local enterprises in the field of renewable energy and the actual gap and has put forward support strategy suggestions for this:
1. Divide the market The solar PV market is divided into small projects (less than 100 MW) and large projects (more than 100 MW). Small-scale projects (less than 100 MW) can be reserved exclusively for small-scale PV participants, reducing pre-qualification requirements, while large-scale projects can be open to all participants.
2. It is predicted in the planning of guiding local enterprises to participate in the development and O&M link that the local manufacturing capacity of photovoltaic modules will be difficult to improve in the short term, and it is not suitable as the first content to be promoted for localization. However, the internal rate of return (IRR) of large-scale solar PV projects is between 8% and 10%, and the IRR of operation and maintenance is between 10% and 12%, and local enterprises have a significant advantage.
3. Provide financing support: Consider providing low-interest financing loans to local developers, as well as local EPCs and O&Ms involved in renewable energy.
The main renewable energy developers in Qatar are as follows:
Nebras Power: Large-scale renewable energy developer, mainly in overseas markets such as Jordan, Brazil, Oman and Indonesia. Its projects include Amin (125MW, Oman), Francisco Sa (114MW, Brazil) and AM Solar Facility (25MW, Jordan).
Qatar Energy Renewable Solutions: Focusing primarily on the local Qatari market. Operates the Siraj-1 solar project (800MWp DC) in Al Kharsaa as well as a number of medium and small projects such as the one developed for Qatar Fuel (WOQOD).
Powergreen Innovations Unlimited: Focused on small-scale renewable energy projects, with an average project size of less than 1.7MW.
Sadeen Enterprises: Mainly develops renewable energy projects with a scale of about 1MW or less.
Sama Sustainability & Renewable Energy: Focusing on the development of small-scale renewable energy projects of less than 0.6MW.
Develop incentives for renewable energy
To incentivize the development of renewable energy, this version of the strategic plan proposes specific proposals such as REC schemes, carbon offsets, net billing schemes, tendering strategies, local content targets, low-cost financing schemes, vocational training schemes and REC training.
1. Renewable Energy Certificate (REC) Program: Establish a REC program to create a tradable letter of credit for every 1 MWh of renewable energy produced as an additional revenue stream. The International Renewable Energy Certificate (I-REC) system, which is a standard used in countries outside of North America and Europe, is recommended.
2. Carbon offsets: As another way, carbon offsets can provide incentives to avoid or reduce greenhouse gas emissions.
3. Net Billing Plan: With two-way metering, consumers sell excess electricity back to the grid to offset future electricity consumption, incentivize consumers to install photovoltaic systems, and reduce pressure on the grid.
4. Renewable Energy Bidding Strategy: Develop and implement a tendering strategy to incentivize local companies to participate in large-scale renewable energy projects.
5. Local Content Target: Setting local content targets requires developers to work with local EPCs and O&M companies.
6. Low-Cost Financing Program: Provide low-cost financing programs to support local businesses to set up EPC and O&M companies focused on renewable energy.
7. Vocational Training Programs: Provide affordable vocational training programs, encourage local developers, EPCs, and O&Ms to sign up for their employees, and build renewable energy capacity.
8. REC Training: REC training for EPCs and O&M companies to motivate them to get involved in the renewable energy industry.
Although there is no mention of a renewable energy tariff mechanism in the strategic plan, the incentives are aimed at reducing the cost and price of renewable energy projects in various ways and providing a level playing field to ensure reasonable returns for developers.
