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• Emerging markets showing strongest potential for growth
• Technology advances will lower costs even further
Investment in education and research and development and an increased focus on emerging markets will define the renewables industry over the coming years, according to leading industry figures who gathered in Abu Dhabi today for a high-level discussion at the World Future Energy Summit 2012.
Speaking at the plenary session Business Leaders in Renewable Energy – Insights from the Executive Suite, nine senior figures from the energy sector agreed that 2012 was likely to be a challenging year – but that those challenges could be overcome by a commitment to strategic investment.
Steve Bolze, Senior VP, President and CEO of GE Power and Wind, said that only those companies that invested significantly in R&D and innovation will thrive. "Given the times, technology investment has to be the long-term differentiator in the sector," he said.
Bjorn Haugland, COO of Norway’s DNV, agreed, adding that his company is committed to investing 6 to 7 percent of turnover to research and development.
"The next ten years is going to be a major transition period," he said. "We need to take the next generation of renewable technology from the drawing board, where it is now, to being fully scaled up."
Steve O’Rourke, Senior VP and Chief Strategy Officer at Sun Edison said the challenge ahead for his company lay not with the science, but with implementation. "When it comes to photovoltaics, the science is already out of the equation," he said. "What we now have is an engineering problem, and that’s what we must concentrate on. But, solving that engineering problem is very do-able."
James Brown, President, Utilities Business Group at First Solar said that despite the difficulties the industry is facing, innovation will continue to make renewables more attractive for end-users. "The industry was in chaos last year," he admitted, citing the over-supply in the PV sector, but he added that tech breakthroughs, such as the record-breaking 14.4 percent efficiency in pholtovaltaic modules announced by First Solar at WFES earlier in the day, continue to be made, and will bring the cost of the renewable down further.
He also said that emerging markets would be a focus for the company, "We have been slightly overweight in developed markets," he said, adding that renewable energy is increasingly attractive for emerging markets as they seek to address long-term energy challenges.
Emerging markets are also on the agenda for Shell as it renews its focus on gas production as a replacement for coal in power plants. Mark Carne, executive VP for Shell International, said the priority of Shell would be gas, the cleanest of fossil fuels. "Last year was the first year in this company’s 100-year history that we produced more gas than oil," he told delegates.
He flagged Iraq as a key area for gas development for the company. "700 cubic feet of gas per day is flared off in Iraqi refineries," he said. Shell aims to capture this resource to use for Iraq’s internal energy needs. "This is a very exciting project that will make a real difference to the future of Iraq," he said.
Tulsi Tanti, Chairman and Manging Director of Suzlon, India, said that despite the extremely challenging macro and micro economic environment, "emerging markets continue to show great potential."
He cited the fact that the costs of wind power were now at par with gas, and would catch up with coal by 2015. But he warned that education was not keeping up with growth in the sector. "Talent is simply not sufficient to support growth in the industry, so we need to make significant investments to boost that talent pool."
Jean-Pascal Tricoire, President and CEO of Schneider Electric, outlined his company’s four-point plant for 2012 and beyond: connect the company’s 40 sites in 25 countries to drive efficiencies of scale; connect the customer base to improve efficiency in transmission, by leveling out peak demands; improve access to energy in areas of operation and, lastly, to boost education in new technologies.
Frank Wouters, Director of Masdar Power, said education remained a priority for the Abu Dhabi-based initiative, which also runs the Masdar Institute, a homegrown university dedicated to renewable and clean technology.
He said that Masdar Power would use 2012 to build on its innovation breakthrough in 2011 – a concentrated solar power generator that harnessed the properties liquid salt to provide power generation 24 hours a day.
"This year we will have the second generation on the drawing board – we see massive potential with this," he said. Wouters added that Masdar will also seek to open new markets. "We need to be agile," he said. "Overall, I’m not particularly pessimistic about the future, but you have to be able to tap into markets as and when required."
Under the theme of "Powering Sustainable Innovation," WFES 2012 is welcoming more than 26,000 attendees, including 3,000 delegates and 650 exhibiting companies over the four-day summit being held at the Abu Dhabi National Exhibition Centre (ADNEC). The summit is hosted by Masdar, Abu Dhabi’s long-term investment in the commercial realisation of renewable energy and sustainable technologies.
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