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In an interesting interview with SolarQuarter Middle East, Jeremy Crane – CEO & Founder, Yellow Door Energy talked about the company and its presence in the UAE. He gave us insights into Utilities 3.0 and also about solar+storage. He spoke about Covid’s impacts on the solar sector as well and gave us his views on how the sector is going to perform in the near future.
Can you give me a bit of background about yourself and the company?
My name is Jeremy Crane and I’m the CEO & Founder of Yellow Door Energy. We are the leading sustainable energy partner for top-tier businesses in the Middle East and Pakistan, with over 200 megawatts of awarded solar projects to-date. With our sustainable energy solutions, businesses reduce energy costs, improve power reliability, and lower carbon emissions. This is in line with net-zero targets set at COP26, supported by governments, financial institutions and leading organizations worldwide. I am a mechanical engineer by training and have been working in the global energy transition for the past two decades. My journey in energy started with wind farms and power plants in the United States and Central America. I then started a business that developed $40 million worth of rooftop solar projects in Canada. Expanding internationally, I developed $250 million worth of utility-scale solar projects in Europe and Asia.
In 2015, I founded Yellow Door Energy in Dubai, UAE to bring distributed solar to businesses. In 2016, we signed our first solar lease with Unilever to bring clean electricity to their personal care factory in Dubai. Fast forward to today, we are proud to have among our customers’ names such as Nestlé, Majid Al Futtaim, and more.
What is the current situation with regard to the solar sector in UAE and the solar market throughout the wider region?
The UAE is a leader in solar both in terms of strategic initiatives and actions on the ground. In October 2021, the UAE announced its commitment to become Net Zero by 2050, and solar, a clean source of electricity, plays an integral part in this target. Her Excellency Mariam bint Mohammed Almheiri, UAE Minister of Climate Change and the Environment, shared that over $160 billion will be invested in clean and renewable energy projects by 2050. This initiative complements the UAE Clean Energy Strategy that was launched in 2017, which aims for the country’s clean energy mix to increase to 50% by 2050.
Within the emirate of Dubai, the local utility DEWA’s net metering program, aptly named Shams Dubai, enjoys significant success. To-date, 6,880 buildings are connected to rooftop solar with a total capacity of 365 MWp. Shams Dubai enables commercial and residential buildings to install rooftop solar and enjoy cost savings. Utility scale solar, both PV and concentrated, will also play a critical role in the UAE, with the inauguration of the Mohammed Bin Rashid Al Maktoum Solar Park that will eventually have a capacity of 5000 MWp by 2030. In Abu Dhabi, the massive 1.2 GWp Noor Solar Park continues its econd year of operation that generates “enough power to meet the needs of 90,000 people”.
Across the region, countries continue to set ambitious renewable energy targets. Saudi Arabia and Bahrain have both pledged to be net-zero by 2060. In Jordan, 20% of the Kingdom’s electricity generation already comes from renewable energy, a significant increase from just 1% in 2014. Its solar wheeling and other renewable energy programs were so successful that the renewable energy target has been increased to 31% or 3,200 MW by 2030.
Overall, I’m optimistic that solar power, specifically distributed solar, will continue to gain traction across the Middle East, helping businesses meet net-zero targets, reduce energy costs and become more competitive and resilient.
What is Utilities 3.0 and how does it help businesses achieve net-zero?
The utilities industry is transitioning from Utility 2.0 to Utility 3.0. Utility 1.0 is the traditional and centralized utility that was primarily government-funded, first established a hundred years ago. Utility 2.0 started around 20-30 years ago and involved the unbundling of distribution and transmission networks, regionalizing the generation and transmission of power.
Today, we are building a new model of delivering power through distributed generation, known as Utility 3.0. This means we can generate electricity at the point of demand, where it is needed, when it is needed, such as from a rooftop or carpark. This model is particularly suited for emerging markets where grid infrastructure is insufficient, and demand is growing. Due to its decentralized nature, distributed solar can enhance resilience and security. Coupled with a business model such as a solar power purchase agreement (PPA), also known as a solar lease, businesses can enjoy energy savings and become more competitive.
A solar PPA/lease is a long-term contract with a performance guarantee on the solar plant. The PPA / lease provider, such as Yellow Door Energy, is responsible for financing, designing, building, commissioning, operating, and maintaining the solar plant for the duration of the lease. In the UAE, businesses can enjoy between 20-50% savings on their electricity bills through a solar lease.
What is your take on the solar + storage system? How viable is it? Do you have any infrastructure for providing energy storage?
Solar and storage are very viable, in particular for markets with unreliable electricity grids or for off-grid applications. We are actively pursuing opportunities to bring solar and storage solutions to businesses, and you’ll hear more about this very soon.
What impacts has Covid-19 had on the generation and development of renewable energy in the region?
The pandemic has accelerated the adoption of distributed solar, specifically in solar PPAs/leases as businesses look for ways to reduce electricity costs without any upfront investment. Our company experienced an increase in inquiries during the pandemic and in 2021 has secured over $100 million of new energy projects. This shows the business community’s interest in reducing costs to remain competitive and resilient in a post-pandemic world.
How do you see things developing over the next five years or so?
In the next 5 years, I believe that most rooftops in the Middle East will be equipped with solar panels. Firstly, the price for solar has fallen significantly, specifically 82% in the last decade, making solar cheaper than new coal. We are experiencing some pricing pains due to the pandemic but I believe they are short-lived. At Yellow Door Energy, we are working closely with our suppliers to minimize the impacts on our projects and continue to bring clean energy to leading businesses in the region.
Secondly, there have been calls for tariff reforms, as electricity subsidies cost GCC countries more than $120 billion in the past 20 years. With potential increases in electricity prices from the grid, businesses will look to cheaper solutions such as solar.
Thirdly, technological advancements will continue to make solar more efficient and cost-competitive. There are exciting developments in the green and blue hydrogen space, energy storage, EV, big data/analytics, artificial intelligence, etc. At Yellow Door Energy, we are always analyzing these new technologies to assess their suitability in our suite of services, with the end objectives of maximizing the energy savings for our customers and helping them achieve net-zero emissions.
Lastly, countries in the region recognize the importance of sustainability and preserving the environment for future generations. The Net Zero commitments are just the beginning. Deploying renewable energy is integral to every country’s sustainability strategy, thus more favorable policies will be in place to encourage the adoption of renewable energy.