The dark truth

The power cuts that brought Dubai to a standstill are being blamed on technical failure. But as Anil Bhoyrul, Adam Porter and Richard Agnew report, a simple look at the figures suggests Dubai’s power generation capacity is in serious need of upgrading.

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By  Anil Bhoyrul, Adam Porter and Richard Agnew Published  June 19, 2005

The dark truth|~|THE-DARK-TRUTH-200.jpg|~||~|WHEN YOU are climbing down the fire exit from the 38th floor of Emirates Towers, in the sweltering heat without air conditioning, the chances are you are more than likely to join in the many conspiracy theories now floating around the City. Just what exactly caused last week’s power cut, and more importantly, did Dewa have advance notice of the impending chaos? But over a week on, Dewa is still left to answer some key questions. Crucially, less than half an hour after the power cut began at 9.47am on June 9, Dubai’s Police Chief Nasser Musa announced that a power cable had caught fire at the Jebel Ali Power Station (where the Emirate’s power is supplied from). An hour later, this was dismissed by the UAE government news agency WAM. Instead, it came up with the official explanation of a technical fault, explaining that “a sudden failure in one of the main Transmission Sub-Station[s] at Jebel Ali Power Station caused the power failure to the city of Dubai at around 09.47hrs on 9th May 2005.” Apart from getting the date wrong by a month, Dewa has yet to make clear what exactly happened. According to three different sources at Jebel Ali Power Station, spoken to by Arabian Business, rumours of an “impending” power cut were circulating around the station on Wednesday June 8. Two workers claim they were told in advance that the station’s power would be turned off at 7am, for four hours, due to “regular maintenance”. “We were told not to come to work. There would be no point,” one worker explained. It is also claimed by other workers that an official memo was sent to some staff at Jebel Ali Power Station telling them of the maintenance work. Dewa says it is not aware of any such directive. However, if the power cut was unexpected, the reaction of the Dubai authorities was remarkably quick. Within eight minutes of the cut, at 9.55am, police were manning traffic lights right across the city, particularly in the congested Bur Dubai area where the lights had failed. The city’s gold souks and banks were under police guard by 10am, just 13 minutes after the power cut began. Dubai Municipality says that it re-directed over 200 police onto “power cut” duty — the speed of their deployment was nothing short of remarkable. This is the second citywide power failure in four years. Dewa has a second and third back-up system to provide electricity when there is a failure in the main power supply. But none of them kicked in to maintain the power supply. This time around, however, it is clear that the UAE’s demand for power is greater than ever — and accelerating at an unstoppable pace. Power generation in the UAE is poised for a phase of exponential growth in the next five years. The boom has made it necessary to have demand projections revised drastically. The UAE’s power demand growth is showing rates of 10% as against the global average of 3%. All this in the wake of massive population growth and a spectacular building boom which is putting pressure on the country’s installed capacity of just over 10,000MW. The UAE’s power sector is now expected to require more than US$10 billion in new investments over five to seven years as consumption surge will sustain a 10% to 12% growth. The figures come from Dewa’s own officials, although no official statement has been put out. The country’s installed power generation capacity, which has been growing at an annual 24% over the past 30 years, is poised to reach 15,000 MW to 17,000 MW within the next five years to cope with the demand surge triggered by the current all-round developments. The UAE Federal Electricity and Water Authority’s power generation and distribution programme received a AED1.68 billion in the recent budget, the highest of any department. This is not surprising: the total electricity production increased from over 45 million KW per hour in 2002 to over 48 million KW/h in 2003. When the on-going projects in Dubai are completed, the emriate’s power generation will surpass 4000 MW. Abu Dhabi and other emirates are also investing heavily on expanding the power capacity by setting up new plants. The latest estimate is that the Middle East requires an investment of more than US$1 trillion over the next 20 years, mainly in the utility sector, with a strong focus on power generation, distribution and lighting. Some 33% of works for the UAE National Power Grid project, which will include Abu Dhabi, Dubai, Sharjah and Fujairah power grids, have been already completed. Bids for the AED4.6 billion Gulf Power Grid will close by mid-June and the contract awards for the first phase are expected to be announced by September. The grid will, by 2008, connect Bahrain, Kuwait, Qatar and Saudi Arabia, with the UAE and Oman being added later. The massive project involves cabling, building substations and networking all the six countries. The Gulf region is expected to invest more than US$100 billion to meet growing power demand that is expected to rise to 116,000MW by 2020. But in the short term, total investments in the GCC power sector will be some US$46.4 billion for covering expansion of existing power plants and setting up of new projects to add around 37,000MW to their current capacity by 2010. While Saudi Arabia will require an investment of US$20 billion, investments in Kuwait are estimated at US$3.6 billion, US$3 billion in Qatar, US$1 billion in Bahrain, and US$800 million in Oman. Clearly, the required investment and power capacity is a long way from the current figure, fuelling fears of a repetition of last week’s power cut. And giving further rise to growing claims that the cut may have been a pre-planned “upgrade” that triggered a city-wide cut. ||**||

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