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UAE is Oil-Rich, but Struggles to Get Power to All - ASHARQ AL-AWSAT English Archive
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SHARJAH, United Arab Emirates, (AP) – In dusty and sweltering Industrial Area 13, just beyond the glow of Dubai’s illuminated skyscrapers, Abdullah Kuttakunnil serves patrons of Kannur Restaurant by candlelight.

It’s a matter of necessity, not ambiance. For much of the past month, residents of Sharjah, an increasingly teeming city hugging an interstate border with the wealthier city-state of Dubai, have suffered through power failures often lasting most of the day.

“It’s very, very difficult to sleep,” Kuttakunnil said, his face beading with sweat as the air conditioner sat silent one steamy evening this week.

He said he’d been without power for more than 12 hours straight — an outage that, like others, has been hurting business and making life unbearable during one of the hottest times of the year.

More than mere inconvenience, the power cuts offer a troubling window into the fallout of breakneck development that has outpaced broader planning efforts in the United Arab Emirates, home to one of the world’s largest oil deposits.

“The issue is just a lack of generation capacity” combined with low subsidized prices that encourage over-consumption, said Gulf energy expert Robert Bryniak, chief executive of Golden Sands Management Consulting in Abu Dhabi.

“You’re getting excess use of electricity, which is resulting in more power plants being demanded,” he said. “It’s a vicious circle.”

The Emirates, home to the world’s fifth largest reserves of conventional crude oil, is using its petrodollars to build one of the most modern countries on earth in a matter of decades. Vast amounts of Arabian oil money have packed its cities of Dubai, Abu Dhabi and Sharjah with spectacular skyscrapers and mosques during a fierce multiyear building boom — one that was slowed, but not stopped, by the global economic downturn.

Yet for all its oil wealth, the country has to import natural gas from its neighbors to keep its power plants humming. And, as the glimmer of candlelight in Sharjah’s industrial zones illustrates, it’s having a tough time providing reliable power for all.

The situation is only expected to become more difficult as a booming population, driven largely by an influx of workers from Asia, Europe and the Middle East, ensures those energy needs will continue to balloon.

Demand for electricity could hit 40,000 megawatts by the end of next decade, suggesting a growth rate of nine percent annually from 2007 levels, according to estimates from the UAE embassy in Washington. The country has enough gas to produce only about half that amount.

“There is a misconception that Abu Dhabi has a lot of gas,” said Philip Weems, an expert on energy at law firm King & Spalding in Dubai. “There really hasn’t been much of an incentive for producers to go out and explore for more gas, so you end up with situations like this.”

The Emirates is looking for alternatives.

Abu Dhabi is plowing some of its oil wealth into green-energy projects. But the government estimates that solar and wind power might provide only 4 to 5 percent of peak demand by 2020 at best.

Emirati leaders are also working to create a civilian nuclear energy program. President Barack Obama approved plans for the U.S. to help the UAE with the project earlier this year, though Congress could still try to block the deal.

Contracts to build the first reactors in the $41 billion project are expected to be awarded this year.

New oil and coal-fired plants have been considered, but they would take years to build.

Poor planning plays a role in the country’s power problems.

A state-owned newspaper, The National, recently cited a yet unpublished government report as saying about 1,000 commercial buildings in the north of the country have been waiting for months to be connected to the power grid.

“You’ve got developers building commercial towers, and sort of, at the last minute, starting to focus on if the power’s there or not,” Bryniak said. “Of course that’s a problem.”

The exact cause of Sharjah’s outages remains murky.

Repeated calls to the Sharjah Electricity and Water Authority, which is responsible for providing power to the sheikdom, went unanswered. The company is part of a patchwork of four different electric grids that cover the Emirates.

Residents complain they can’t get answers from the company because phone lines are constantly jammed with complaints.

Even the country’s newspapers, which rarely criticize government institutions, are voicing frustration.

On Wednesday, the Dubai-based Gulf News newspaper blasted the Sharjah power company, known as SEWA, and called for the creation of a nationwide electricity grid.

“It is wrong that a national electricity grid still does not exist in one of the world’s richest nations,” the paper’s editors wrote.

Khaleej Times, another daily, complained that “no one, not even the harried SEWA bosses, seem to have the vaguest idea what is really going on.”

The outages make life miserable for Sharjah residents, many of them low-wage laborers from South Asia.

Some sleep in cars with the air conditioning running or stay with family in nearby Dubai to escape the heat. Others are faced with unexpected expenses from buying battery-operated lamps or fuel for generators.

Businesses like Kannur Restaurant are hit especially hard, as refrigerated food spoils and business drops.

Kuttakunnil, who like many of Sharjah’s residents moved here from India for work, estimated business is down 60 percent or more at Kannur because of the power cuts.

“We have no more customers. No one is coming,” he said, before again dialing an emergency hot line to the power company.

“Only busy. All the time busy,” he said with a shrug.

Asharq Al-Awsat

Asharq Al-Awsat

Asharq Al-Awsat is the world’s premier pan-Arab daily newspaper, printed simultaneously each day on four continents in 14 cities. Launched in London in 1978, Asharq Al-Awsat has established itself as the decisive publication on pan-Arab and international affairs, offering its readers in-depth analysis and exclusive editorials, as well as the most comprehensive coverage of the entire Arab world.

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