Dubai & Coal: Think About It?Dubai could turn to coal to meet power demand
26 February 2008 - Dubai is planning to generate up to 4000 MW of electricity from coal, in the latest sign that a lack of gas is forcing Gulf states to turn to alternative energy sources.
MEED reports that the emirate is also pushing ahead with plans to import electricity from Iran, and is working on developing steam and nuclear plants. The coal fired power plants would have a capacity of 2000-4000 MW.
"It is a very serious option," says a source at Dubai Electricity & Water Authority (Dewa). "A plot has already been allocated."
The likely opposition from members of the public unwilling to have a coal-fired plant near them means that Dewa is refusing to say where the plants will be built, except that it will be in Dubai.
However, a UAE-based industry figure says Dubai would not be the best location for the project. "It would make more sense in Fujairah," he says.
"The barges would not have to come into the Gulf and they could get the coal there more easily. "If they bring the coal barges through to Dubai, they will have to pay high insurance rates and there is a lot of handling involved."
While the costs of building a coal-fired power plant are higher than for a gas plant, Dewa is confident it will be more cost-effective in the long term. Gas shortages have forced the authority to run its plants on expensive liquid fuel oil and coal could cut its costs.
Dubai is not the first country in the region to look at coal power. Oman is also considering it. However, Dewa's calculations could be affected by soaring coal prices, which hit a record high of $116 a tonne in early February because of a combination of high demand and tight supply.