Monday, August 15, 2016

Maximum Power: Mega Trends in the GCC Regional Temporary Power Industry

From smart solutions to energy efficiency, the value addition curve for rental power plants is always on the rise. Altaaqa Global shares its insights about mega trends that the regional temporary power industry must align itself with. 

  • What is you overview of the current Genset market in the GCC?

The temporary power industry is largely dependent on the prevailing market situation and activities. In the context of the GCC, the rental power market is conditioned by several factors, including:

  • Utility shortages, particularly in KSA and Kuwait, especially during peak summer months 
  • The gradual recovery of the construction industry in UAE and Saudi Arabia
  • Absent or unreliable electricity connection in various areas in the region
  • Regional growth in population and improvement in the standards of living
  • The availability of diesel, and the nascent increase in the supply of natural gas
  • Large industrial customers/companies turning to rental power to maintain the effectiveness/productivity of their operations in times of power interruptions or peak shaving
  • Opportunities for infrastructure rebuilding and development 

KSA, Qatar and the UAE have consistently been the biggest market for gensets in the region, be it for rental or for sales, as they have been demonstrating high economic growth rates buoyed by industrial and commercial development. At present, however, we see a slight decline in the interest on temporary power services owing to the suppressed prices of oil and other commodities.

  • What are the new trends shaping demand for Gensets (across all types)? What is your projection of the region’s Gensets market in the next five years?

We are noticing the gradual expansion of the natural gas and dual-fuel genset markets, particularly where inexpensive natural gas is available. The growth of such markets are supported by the increase in unconventional gas resources and by stringent emission regulations in effect in many countries around the world.

Fuel availability and the costs of installing safe and reliable fuel delivery infrastructure have traditionally posed limitations on the growth of the natural gas generator market. Today, gas is becoming increasingly available and gas generation technology progressively finds application in bigger and longer-duration projects. The availability of dual-fuel generators (which significantly simplifies the transition from diesel-run to gas-run generators), is helping overcome these installation and operational obstacles.

  • How is your company geared up to meet the new demand trends?

The temporary power services that we offer vary from industry to industry and site to site.
In recognition of the changes in the market’s demands, we will continue to offer the most fuel efficient, reliable and technologically advanced generators and power systems to our clients to reduce their overall operating costs. We will combine it with consistent technical support and expert advice on equipment selection.  

The diesel generator market will continue to grow in the next several years, so we will continue to have diesel generators readily available in our fleet. As natural gas becomes increasingly available, and gas power generation technologies progressively find application in bigger and longer-duration projects, we will ensure to offer natural gas generators where it is appropriate.

  • What is the region’s uptake on smart technologies? What solutions does your company offer to that end? What are some of the latest innovations in Gensets to enhance user experience?

There is an intense interest in the GCC in technologies that aid in the provision of reliable and efficient electrical power, resource conservation and environmental stewardship. The relevance of such technologies cannot be overstated in the GCC’s modern environment, which sees high levels of power consumption that takes a toll on the generation, transmission and distribution facilities.

In this light, here are some of the smart technologies available in our power generations systems:

  • Our generators are equipped with state-of-the-art control and protection systems that allow them to change operational modes (island, grid or standby) in just a push of a button. Because of this, our generators can provide the precise electrical power at the exact time it is needed, in whatever mode required. 
  • Our generators are also equipped with local control systems that provide power metering, protective relaying, and engine and generator control and monitoring. They are integrated with digital voltage regulators, which works to enhance system monitoring. They offer the ability to view and reset diagnostics of all networked controls, eliminating the need for separate service tools for troubleshooting. They also have real-time clocks which allow for date and time-stamping of diagnostic and events.
  • To enhance user experience, our generators are equipped with engine operator interface featuring graphical display with positive image, transflective LCD and adjustable white backlight/contrast. Additional features include engine cool-down times, engine cycle crank, three engine control keys and status indicator (run/auto/stop), lamp test and alarm acknowledgement keys. It has warnings/shutdowns with indicating text for low oil pressure, high oil temperature, emergency stop, over speed and over crank, on top of an emergency stop push button and shortcut keys for engine and generator parameters. 

  • What are the latest innovations on Bi-fuel portable generators? 

Our dual-fuel power generators are specifically developed to reduce fuel costs and decrease emissions. They are equipped with a dynamic gas-blending technology that optimizes output, while being environmentally considerate. Our bi-fuel generators automatically adjust to changes in fuel quality and pressure to allow engines to run on a wide variety of fuels, including associated gas and vaporized LNG, with no loss of performance integrity. Owing to this, no customer input or gas analysis is required during operation, and no re-calibration is needed when the equipment is moved or the gas supply changes.

  • How will the shift towards renewable energy impact the Gensets market in the GCC?

Owing to the rapid depletion of the world’s fossil fuel resources, in addition to greater requirements in carbon reporting, many countries around the world are looking to diversify their energy mix to encourage long-term energy security. A crucial component of this initiative are renewable energy sources.

While renewable energy technologies are being optimized, continued dependence on traditional sources of electrical power is needed to bridge the power gap and maintain a continuous and reliable supply of electricity. Temporary power solutions, for instance, can work in tandem with renewable energy sources to help mitigate the issues of unpredictability and intermittency.

Aside from supporting renewable energy facilities in producing electricity, temporary power plants can also provide power to renewable plants throughout their life cycle. Temporary power plants can provide supplemental power to renewable facilities during planning, manufacturing, installation, commissioning, operations and maintenance. Temporary power plants can help ensure that renewable energy plants are constructed and delivered on time and as planned, and that they remain efficient, reliable and in optimum condition at all times.

  • Comment about the market for Genset spare parts?

In addition to our own in-house capabilities, as an authorized Caterpillar dealer, Altaaqa Global has access to the wide range of technical, engineering, logistical and service/maintenance resources of other Caterpillar dealers around the world.

In mobilizing for a project, for instance, we may tap the power generation resources, technical & engineering expertise and logistical facilities of the local Caterpillar dealers where we operate, or of any Caterpillar dealer around the world. We also have access to locally available parts and can call for local maintenance service or technical support. Thanks to this synergy, we are able to provide for a quick and efficient installation of power plants and ongoing support for projects anywhere in the world.

  • What are the major challenges in the GCC Gensets industry? How is the slump in oil prices impacting the market?

While the fact that the prevailing oil price makes generators cheaper to run is an advantage in theory, we have to remember that the requirement for generators is proportional to the rate of economic activity. At present, the prices of oil and commodities are suppressed, and this is having a negative impact on the interest on power generation services. We, however, expect the industry to rebound quickly as and when economic conditions improve.

  • How is the 5% VAT proposed by GCC countries likely affect the Gensets market?

The introduction of VAT in the region was largely prompted by the drop in revenues in the face of plummeting oil prices. With VAT, businesses and industrial companies must grapple with increased production and higher capital costs. Economists, however, predict that the benefits of VAT to the region will outweigh the financial burdens that come with it.

One positive scenario we see is that with the introduction of VAT, governments in the GCC can have additional revenues that they can use to build additional infrastructure, refurbish existing facilities, and overall improve services to their citizens. These represent excellent business opportunities for temporary power providers. As we have mentioned above, the temporary power industry is conditioned by the prevailing market situation and activities, and if GCC countries intensify their economic and social activities, the industry will continue to thrive in the region.

  • With competition in the market growing, what will industry players need to do to retain their clients and also win over new ones? What steps are you taking towards driving efficiency? How is this likely to give you a competitive edge? What is your company doing to have a competitive edge?

As an authorized Caterpillar dealer, we work closely with the Caterpillar product development team to share perspectives of customer requirements in the power rental business. We continually work on improving the efficiency and reliability of our equipment, and we constantly revisit our procedures and processes with the aim of improving the way we do things in every project.

The role of temporary power has evolved from being a local, short-term, transactional activity to a major global project-based industry. To keep abreast of the opportunities in the coming years, we will continue to hone a highly skilled, motivated & experienced, world-class, power projects team. At Altaaqa Global, we strive to lead the evolution of the industry, and to be recognized as the premier source of innovative technical solutions and the highest level of customer service and support.


Altaaqa Global
Tel: +971 56 1749505

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