ABB's head of global markets and regional manager for Asia, the Middle East and Africa talks to UME
Frank Duggan’s near 30-year journey with ABB has taken him through stints in South Africa, Sweden, Thailand, Poland, Czech Republic, Switzerland, his native Ireland and now the United Arab Emirates (UAE). At close to seven years, this is his longest stay in any country with the power and automation company.
Duggan has risen through the ranks to become ABB’s Head of Global Markets, as well as regional manager for arguably the fastest developing areas on earth. So has he finally settled here?
“Well people in the office say I’m never here,” he jokes in his corner office overlooking the Palm Jumeirah. “I’m probably in Dubai around three days a month. I have responsibility for Asia, the Middle East and Africa, so there’s 55 countries throughout those regions where we have operations, quite significant operations in some of them.”
Duggan moved to Dubai in 2008, the year the global financial crisis took hold. Looking out at the vast number of cranes that again litter the city’s towering skyline, that all seems like a distant memory.
Saudi Arabia is booming, Dubai’s sights are set firmly on the World Expo in 2020 and Qatar is hosting the FIFA World Cup two years later. The economies of the Middle East are once again operating at full throttle.
“The Middle East is very vibrant,” Duggan says. “The rest of the world has faced a lot of economic challenges and some of it rubs off here, but so far we’ve seen that the Middle East economies have continued to grow despite even some of the instability on the political side.”
With economic growth comes the need for more power generation and the grids and control systems that direct that power to where it needs to be, and ABB has continued to stack up the contracts in the Middle East utilities sector this year.
Recent wins include a $55mn deal with Dubai Electricity and Water Authority (DEWA) to build the substation that will integrate power to the grid from the expanded Sheikh Mohammed bin Rashid Al Maktoum solar park.
That was followed by a Memorandum of Understanding (MOU) with DEWA last month to develop a rooftop solar power pilot project at ABB’s premises in Al Quoz, with a grid-connected rooftop 277kW photovoltaic (PV) system.
Under the deal, the project will connect to the grid through a low-voltage distribution board at ABB, and will be used as a learning tool for the deployment of solar PV rooftop installations in Dubai.
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Though renewable energy has still to gain much of a foothold in the Middle East, these are encouraging signs that a breakthrough is on the horizon. And when renewable energy does finally gain traction in this region, companies like ABB will need to be on hand to provide the technology to integrate intermittent power sources and bring stability to a new look grid with multiple distribution points.
Recently there have been a number of bullish statements from the solar industry and the analysts that follow it, claiming that distributed solar power is set to make huge inroads into the global energy mix over the next two decades.
Swiss bank UBS, compatriot to Zurich-based ABB, claims that by 2025 the bulk of our power could be generated by end users with a cost effective package involving a solar panel and battery. The mass market entry of electric vehicles (EV), it says, will be one of the main drivers of this revolution in the way we produce our energy.
Duggan doubts the change will be that dramatic and that a mixture of large scale power plants combined with a lot more distributed power is the more likely scenario.
“I think you’ll see more hydro in some parts of the world and nuclear in other parts, because burning hydrocarbons for electricity is probably the worst usage of them,” he says. “You add more value when you put them into the chemical chain.”
And there are still major hurdles to clear before we see distributed power on a wider scale. The next big challenge from a technical point of view, is solving the storage issue. That will make renewables more viable because then you can actually store the power and remove the intermittency from it.
“Whoever can make storage a mass, commercially viable solution will have a big advantage,” he says. “There are a lot of people working on it and at the moment there are solutions available. We have some that are 50MW solutions but they work for 15 – 30 minutes and they’re expensive, large systems so you have to find a more commercially viable solution.”
The rise of electric vehicles also has the potential to be part of the storage solution, he explains. “You can have cars that are not running connected to the grid and putting power back in and then using power for charging at other times. In certain parts of the world, in China for example, electric vehicles are being heavily pushed by the government as a way of reducing pollution and connecting renewable energy.”
Though we may see utility scale solar plants of 100-300MW in the Middle East, the issue of rooftop solar and how to integrate that into the network is going to be key going forward, Duggan says.
“You’ll see a lot more rooftop and that will be for use at home and then for export back to the grid. We’ve started seeing that in many countries. In South Africa, for example you see a mixture of both utility and rooftop, whereas in Germany it’s predominantly rooftop and in Spain and Italy you have a large utility.
“It depends on the availability of land which is less of an issue here. Keeping the panels clean from dust and the water that requires is more of an issue. There’s a lot of spare land here, but then you have to get the power to where the people need it and that’s where transmission grids come in.”
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The evolution of power generation infrastructure will differ from region to region, depending on the resources available, Duggan says.
“In Africa, where there’s a huge development still to happen, will they follow the grid structure of Europe and America? Probably not. I think we’ll see a lot more micro grids in Africa. It’ll be a quicker way to get power to the people using solar, wind, even hydro than building big, intercontinental grids. We can see that happening there.”
That being said, one of ABB’s latest innovations has the potential to bring two continents closer together. Connecting large scale solar plants in North Africa with power markets in Europe has been talked about for many years. Now ABB has developed a 525kV high voltage direct current (HVDC) cable that makes exporting power under the Mediterranean Sea more viable.
Suddenly, utilities are able to put 2,600MW of power - two and a half times the previous record - through the cable, bringing the unit cost down closer to an overhead line, Duggan explains. To connect Europe and Africa would previously have required building overhead lines through the Middle East.
“Now we have the power with cables to bring it under the sea, so that makes it more viable and cost effective with this light technology,” he says.
Rapid economic growth in recent years has continued to underpin infrastructure development in the region. And as Duggan says, where there is infrastructure development going on, it is always good for a company like ABB. He does sound one note of caution however. Oil prices have been on the slide from $115 per barrel in July to around $80 per barrel at the time of writing, causing some uncertainty for the economic outlook in the region.
“One question around the Middle East economies is the price of oil,” he says. “If the price of oil keeps up we’ll continue to see development and growth. If it goes down then governments may have to look at their budgets.”
On the whole though, Duggan has a positive outlook for the company in the Middle East.
“This is clearly a region where we’ve continued to grow despite the economic trouble we’ve seen elsewhere,” he says. “Saudi will continue to grow, it’s the big market in the region and we have a significant position there. But the other markets are significant as well. In this part of the world you don’t judge a market by population size. The economies are far bigger than the populations.”