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CESI chases Middle East Dream

Floris Schulze predicts exciting times for the company in the region

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Testing machinery used in one of CESI's laboratories
Testing machinery used in one of CESI's laboratories

Less than two years after cutting the ribbon on its regional headquarters in Dubai, the Italian energy consultant and testing and certification company has racked up an impressive list of contracts.

What services does CESI offer?
CESI was established in the 1950s to support the Italian government in testing and certification of high, medium and low voltage components in our laboratory in Milan. Then we moved forward with the acquisition of two key German laboratories in Mannheim and Berlin.

In one month we’re going to open our new high-voltage, direct current (HVDC) laboratories in Mannheim, which is interesting because the Middle East is focusing on HVDC developments, so these components will become more and more important and they need to comply with international standards.

Nowadays CESI has three divisions. Testing and certification; Environmental Engineering, which is focused on environmental impact studies, health and safety risk assessments, etc; and Consulting. We are involved in all kinds of studies on smart grids, smart metering, interconnection studies and, of course, renewables which will become more and more important over the coming years.

What is your presence in the Middle East?
Two years ago we established regional headquarters in Dubai during the World Future Energy Summit, and I took over the Middle East operations and am responsible for all activities here, focusing mainly on the GCC countries at the moment. From Dubai we are expanding our presence throughout the region by opening branch offices and laboratories and we are trying to be on the ground in all the GCC countries.

Right from the beginning we have won a substantial number of prestigious contracts. One of them relates to electricity and natural gas trading among interconnected Arab countries. This was followed by a very complex study on the smart grid and smart metering roadmap for the Kingdom of Saudi Arabia which is one of the largest developments of its kind on a national scale in the Middle East.

After that we were awarded one of our largest contracts to date, related to the HVDC interconnection between Riyadh and Jeddah in Saudi Arabia. And we were awarded another contract for a study on the North-South HVDC link within the KSA.

We are also involved in a number of renewables studies, for example DEWA has awarded a project related to solar in Dubai to support them in the technical and regulatory aspects of renewables and how to operate, maintain and manage these types of developments.

At the same time we have won a number of framework agreements together with GCC Interconnection Authority (GCCIA), which is the regional authority to enhance power and energy intergration amongst the countries in the region.

I’m very proud that, within two years, we have become involved in all types of activities in the region, including testing and certification. Many manufacturers providing components to the utilities in the Middle East have them tested in our laboratories in Milan, Mannheim and Berlin.

Tell us more about the regional interconnection study
The purpose of the study is to identify the best options for new electricity and gas interconnections in the region. We have finalised the study which involves 20 countries so it’s been a very complicated undertaking.

The results have been sent to the sponsors at the Arab Fund and will be presented either at the Cigre 2014 event in Paris (held August 25-29) or GCC Cigre Bahrain (November 10-12), and they have asked me to wait until after this presentation before sharing the detailed conclusions and outcomes of the project.

What I can say is that, for the Middle East, especially the GCC, if you look at energy demand over the coming years, interconnection is a big part of the solution to start energy trading amongst different countries, and of course this requires potential infrastructure developments in the different countries.

We managed to define five or six technical, infrastructural developments that need to be carried out in order to enhance power trade which will benefit business and promote energy security in the region.

What other projects has CESI carried out?
We carried out a project for the electricity regulator of Saudi Arabia, ECRA, to define a roadmap for smart grid and smart metering developments in the Kingdom.

This was a challenging project because we had to deal with 100 different stakeholders in the country, including huge companies such as Saudi Aramco, to align them for the roadmap. It took us over a year to support ECRA in defining and developing the roadmap to enable Saudi Arabia to increase efficiency, reliability and improve energy security within the Kingdom.

The primary objective of the study was to identify Saudi Arabia’s current and future challenges with smart metres and smart grids, review available smart technologies worldwide and then try to tailor them for the local market which is quite different from elsewhere in the world.

We had to take into account all the latest energy developments in the Kingdom like nuclear power, renewable energy and conventional power plants. It took six extensive workshops of several days each to align all the stakeholders with the roadmap and that was a huge challenge that we have never seen before in other countries.

We have agreed on the roadmap which means that in a few months we will be entering the implementation stage throughout the Kingdom, including distribution and transmission, so it’s quite a substantial project and is quite unique I would say, compared to other studies carried out throughout the world.

So we are going to see tremendous opportunities coming up for companies in Saudi?
That’s correct. And there are lots of important aspects related to these developments in the KSA, such as the potential to export more oil rather than burning it in domestic power plants.

What about the role of renewables in the region?
Renewables are playing a crucial role in all regional developments, not only the interconnected Pan Arabic grid, which allows the different countries to develop renewables and maybe to export to other countries, but also the HVDC development that we are involved with at the moment.

For example the Egypt-Saudi Arabia central west link will definitely stimulate and support renewable developments because the capacity will be increased and there’s a possibility to immediately link renewable developments with these types of interconnections. Smart grids and smart metering is also essential for supporting renewable developments throughout the region.

Who will benefit from these developments?
One of the interesting spin-offs, which we’ve also seen in Europe, is that it will generate lots of local business to provide components and equipment tailored for the local market. Manufacturers developing components for the European market cannot easily transfer them to the Middle East. So what happens is that new business, such as branch offices and laboratories, will arise to manufacture and test components for the local market to make sure they meet international standards. This has already happened in Dubai and Saudi Arabia.

What other opportunities is CESI looking at in this region?
We will support utilities to embark on these interesting and challenging developments. With renewables there are lots of challenges such as devising regulations, pricing and other technical challenges in order to connect them to the grid.

I foresee huge growth in demand over the coming years. It’s impossible to just build new power plants, you need a mix of all kinds of resources - conventional, nuclear, and renewable - but also the efficiency of existing power plants can be improved. They can be part of the solution to meet future demand.

Utilities in the Middle East are also now focusing on asset management, how to monitor and maintain their assets and improve performance, so I foresee lots of operational maintenance support, quality assurance and quality control work for our laboratories as well as testing and inspection services on site for utilities. There are many opportunities here for our company over the coming years in both the technical and environmental fields.

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