District Cooling In Qatar
Practice, Challenges & Regulatory Interventions
Presented by Engineer: Ibrahim Mohammed A Al SadaManager: District Cooling Services Department Qatar General Electricity & Water Corporation - KAHRAMAA
▪ District Cooling Practice in Qatar.
▪ District Cooling Benefits to Qatar.
▪ District Cooling Suitable Areas in Qatar.
▪ District Cooling Challenges in Qatar.
▪ District Cooling Regulation In Qatar .
▪ Advice for countries with scarcity of Water.
Key Points
Water & District Cooling
Water is life
District cooling is consuming large quantity of water
In gulf region the fresh water is precious
Air Conditioning Electricity Bill
Conventional Air- Conditioning Electricity Bill is High
District Cooling Can Cut Air Conditioning Electricity Bills by Half
District Cooling Practice in Qatar
6
District Cooling in Qatar served by two major District Cooling services providers
Qatar Cool
• Established & Operated In 2003.
• 3 Central Plants in West Bay area(107,000 TR) & 1 in Pearl Qatar(130,000TR)
Marafeq Qatar
• Established & Operated in 2012
• Central Plants in Lusail City (to be 300,000 TR by 2022) and Barwa City (37,000 TR).
Number of Private District Cooling Systems
• Like Qatar Foundation ,Cultural Village (Katara),Al GassarDevelopment, four season hotel, Qatar University etc
Qatar District Cooling Market
Operational District Cooling Projects
SN Operational District Cooling ProjectsInstalled Cooling
Capacity (TR)
1 Qatar Foundation Central Plants 142,000
2 The Pearl Qatar 130,000
3 Hamad International Airport 45,000
4 Barwa Village & Commercial Avenue 37,600
5 Qatar Cool - West Bay 2 37,000
6 Qatar Cool - West Bay 1 30,000
7 Qatar Cool - West Bay 3 40,000
8 Hamad Medical City 20,000
9 Msheireb Doha project 16,700
10 The Sports Club -Aspire Logistics 14,200
11 Qatar University Central Plants 24,000
12 Al Gassar Development - St Regis Hotel 10,000
13 Cultural Village – Katara 10,000
14 Villagio Mall 7,500
15 Sheraton Hotel 6,250
16 ALWakrah Hospital 6,000
17 Doha Convention Center 10,000
18 Ritz Calton Doha 2,600
19 Hamad General Hospital 2,000
20 Doha Festival City & IKEA 21,800
21 Four Seasons Hotel 5,000
22 Mall of Qatar 30,000
23 Sidra Hospital & Research Center (Qatar Foundation) 18,000
Total 665,650
Under Construction District Cooling Projects
SNUnder Construction District Cooling
Projects
Expected Cooling Capacity
(TR) - 2022
1 Lusail City - Marafeq 336,600
2 Internal Security Forces (ISF) Camp 30,000
3 QP District Project 30,000
4 Doha Oasis Mixed Use Development 20,000
5 Al Arabi sports Club 15,000
6 North Gate Mall 11,750
7 New Doha Zoo 13,000
8 ALWatania Steel Company 13,000
9 Salwa Beach Resort Hotel 12,000
10 Chlorinated Paraffin Waxes 10,000
11 AL Gharafa Mall(Ezdan Mall) 10,000
12 The Cost Guard Base Project 10,000
13 City Center Mall Najma 8,000
14 Al Khessa Mall (Boulverad Mall) 8,000
15 Qatar Academy at Al wakrah 7,000
16 Utility Building & Car Park (Diwan Amiri) 7,000
17 Kamal Mixed Use Development 6,000
18 Gulf Chlorine 5,000
19 Supreme Education Council Headquarters 5,000
20 World Trade Center 3,290
21 QNM 3,000
22 Sidra Staff Housing at Qatar Foundation 2,000
SNUnder Construction District Cooling
Projects
Expected Cooling Capacity
(TR) - 2022
23 Al Duhail Mall (Tawar Mall) 6,250
24 Al Sadd Sports Hall & Al Sadd Multi Purpose Hall 6,700
25 Lusail Multipurpose Hall 4,600
26 Arab center For Reserch & policy stuides 2,000
27 Al Gharaffa Sports Club 2,000
28 QPMC Bulk Handling Terminial 1,000
29 Naufer Project 3,000
30 AL Rayyan FIFA World Cup Stadium 16,000
31 Al Wakrah FIFA World Cup Stadium 16,400
32 ALKhor FIFA World Cup Stadium (AL Bayt) 27,720
33 Khalifa FIFA World Cup Stadium 70,000
34 Lusail FIFA World Cup Stadium 55,000
35 Precinct 4-FIFA World Cup 16,000
36 Precinct 5-FIFA World Cup 14,500
37 Qatar Foundation FIFA World Cup Stadium 21,800
38 Qatar Foundation Central Plant 9 20,000
39 Qatar University Central Plant (CUS 4) 25,000
40 Al Wajbah Palace 4,500
41 Milaha Logistics City 1028
42 Katara Hills Phase 1 ,2 and 3
Total From Sl no 1 to 42 879,138
SN Under Design Cooling ProjectsExpected Cooling
Capacity (TR)
1 Qatar Cultural Sports Hub - DCP 1 30,000
2 Qatar Cultural Sports Hub - DCP 2 13,000
3 Qatar Cultural Sports Hub - DCP 3 18,000
4 Qatar Cultural Sports Hub - DCP 4 40,000
5 Qatar Rail Vent City Technical Bldg _Musheirib Stn 4,300
6 Qatar Economic Zone 3 (4 DC Plants) 120,000
7 Four Season hotel & Tower 50,000
8 Hamad Bin Khalifa Medical City 31,000
9 Lusail Hotel & Resort Client IDCC 25,000
10 Qatar Economic Zone 1 17,000
11 Al Maha Hospital ( Al wakrah ) 2,000
12 Al Khor Hospital 7,500
13 General Head Quarters & Military Police Camp
14 Al Waab city project 30,000
15 Lusail Palaces 20,000
16 City center Mall Najma
Under Design District Cooling Projects
In 2016, Qatar DC capacity reached ~655 kTR (or 14% of the total cooling capacity) with a
major potential for growth
Current Cooling Capacity and DC PenetrationIn kTR, 2016
Note: 1) Total Cooling Capacity of 4,400 kTR is calculated based on the 2016 peak electricity demand.
14%
85%
4.4
2016
21%
81%
20212018
7.5
21%
77%79%
5.4
19%
20272024
79%
6.8
15%
6.023%
2030
85%
8.3
DC Conventional
655(14%)
3740
(85%)
Conventional Cooling
Total Cooling Capacity
~4,4001)
District Cooling
Real Estate Developer DC Provider
Total Cooling Capacity Forecast Based on 50% DC Penetration – In Million TR, 2016-2030
DC Capacity in 2030 = 1.6 Million TR
District Cooling Capacity
District Cooling Benefits to Qatar
District Cooling Benefits to Qatar
District Cooling
Contributing to Water Resources Sustainability by utilizing TSE & Recycling DC
Blow Down to STWP
10% Saving in Potable Water Capital Demand & 30% in Electrical
Power Generation by 2030
Potential Financial Cumulative Savings to State of Qatar
~ 15 Billion QR by 2030
Cutting the District Cooling Bill by utilizing TSE as
alternative to potable water
1) Potable water demand for cooling if DC plants using TSE switched to potable waterSource: KM Consultant (Strategy& ) Analysis
Yearly Savings in Potable WaterBased on 50% DC Penetration – In Mm3, 2015-2023
3433
31
26
22
13
7
31
3433
313027
2422
98
20222021 20232020201920162015 20182017
If all DC Plants used TSEActual - Based on DC plants using TSE1)
7 6 15 11 5 4 No consumption of Potable Water
Actual Potable Water Consumption for Cooling (Mm3)
All DC plants using TSE
Water Savings due to District Cooling
District Cooling could save QAR 15 Billion by 2030
Potential Cumulative Savings for the State of QatarBased on 50% DC Penetration, In Bln QAR - 2015-2030
Note: Potential savings do not include the monetary saving from the reduced CO2 emissions since there is no carbon emission credit system in Qatar or the regionSource: KM Consultant (Strategy&) Analysis
51%
29%
20%
2030
61%
23%16%
57%
26%17%
2024
2.1
0.3
~154.1
Total2027
50%
30%20%
2021
3.5
51%29%
20%
2018
2.8
28%43%29%
2015
2.1
13%52%35%
Natural Gas ConsumptionDistribution CapacityGeneration Capacity
Qatar Financial Savings due to DC
Advice for Countries with Scarcity of Water
Once decided to use TSE for DC ,What are the requirements
to Succeed .
1) TSE Polishing Plant
2) TSE Network Availability
3) A Place/Network for cooling plant discharge disposal
District Cooling Challenges in Qatar
Source: Press Material, Interviews
Selected End User Complaints in Qatar
“People have moved out from DC building because of the high cost of cooling”
“Utility bills for district cooling are very high”
“Even when we have everything shut off it still
"cools" and we end up paying for it”
“Even when we are not there it still costs us 800QAR a month”
“Resident … have seen price hikes of in their monthly bills”
“Residence in low occupancy buildings suffer most as fixed costs of running the plant is spread across fewer bill payers”
“The surface of our open air large terrace is included in the
contractual cooling area”
DC End user Complaints
Source: Strategy& Analysis
• Unclear consumer rights and obligations
• Inconsistent tariff schemes & limited transparency
• No uniform service standards
• Misalignment in capacity planning and real estate occupancy
• Inefficient DC construction phasing that leads to substantial up-front CAPEX burden
• Gap between actual & perceived benefits of DC impacting its wider adoption
• Distortions in the perceived benefits of DC between end-users, real estate developers, DC providers and Government mainly due to Utility subsidies
• Scarcity in renewable water resources
• Energy-intensive desalinization process that has high burden on economy and environment
• Lack of TSE water quantity/Quality coupled with unclear constraints in discharge
DescriptionMain Challenges
Lack of Consumer Protection
Mechanisms
Issues in Planning and Project
Phasing
Misalignment in Benefit Allocation
Scarcity of Potable Water in the
Region
District Cooling Challenges
DC growth is hindered by several challenges that the DC regulatory framework aims to address
District Cooling Regulation In Qatar
A DC Plan Assessment Map was developed in coordination with Qatar National Development Projects to define the suitable DC served areas
DC Plan Assessment MapDraft DC Assessment Map – Doha Area
District Cooling Suitable Areas
DC Player Categories Entities
▪ Qatar Cool▪ Marafeq Qatar
DC Providers
▪ Kahramaa▪ Ashghal▪ Ministry of Municipality and
Environment▪ Ministry of Public Health▪ Ministry of Economy and
Commerce
▪ Qatar Foundation▪ Msheireb Properties▪ Hamad Medical Corporation▪ Supreme committee for delivery
and legacy▪ Other Major Developers
Government Entities
Developers
DC Stakeholders
A DC regulatory framework needs clarity around 8 dimensions
Dimension Question
Mandating Should DC be mandated in certain areas and to what extent?
IncentivesShould specific incentives be provided to DC providers in order to address the market distortions?
Water Supply & Discharge What water supply to use and how to manage the discharge?
Billing and TariffsHow tariffs should be structured and set? What allocation of payments is needed to align with risks?
Market Competition What rules are needed to ensure a competitive and open market for DC projects?
Technical & Service Performance
What technical standards and guidelines are needed to ensure delivery efficiency and sustainability?
Licensing What type of licensing are required and what are the terms?
Contractual Frameworks What type of contractual framework should bind different stakeholders in the market?
A
B
C
D
E
F
G
H
Regulatory Framework:
Dimensions & Key Questions
The DC Regulator’s organization designed to meet a set of below key principles(benchmarked with Int. DC Regulators.)
DescriptionDesign Principles
▪ Introduce functions able to cover all regulatory activities foreseen by the proposed regulatory framework
Ensure Coverage of all
DC Regulatory
Activities
▪ Minimize the complexity of the organization by clustering separate sections with clear accountabilities and streamlined processes, resulting in short lead time and reduced number of headcounts
Enable Efficient
Regulatory Processes
▪ Consolidate functions requiring similar skill sets and functional knowledge within the same section to create synergies of competences
▪ Grant access of Qatari nationals to key roles in the organization
Facilitate Skills
Development &
Qatarization
▪ Facilitate ability to introduce new functions or increase/decrease headcounts to react to emerging conditions in DC market and emerging national needs
▪ Accommodate development and potential changes to the DC regulations and eventually the regulation of the Conventional Cooling market
Maximize Flexibility to
Changes in Cooling
Market
▪ Minimize implementation effort by limiting changes to current organizationEnsure Ease of
Implementation
1
3
4
2
5
Organization Design Principles for Effective Regulation
To reach the strategic objectives, the DC Regulator takes regulatory actions and assesses them with several KPIs
*) Regulatory Effectiveness: 20% * (% of plants complying with Environmental Law 30/2002) + 20%*(% of complaints processed on DC plants)+20%*(% of inspected DC plants out of planned DC plants to inspect)+20%*(% of employees' satisfaction)+20%*(new technologies introduced out of planned technologies to introduce). Source:Strategy& Analysis
Strategic Objective
Environmental
Protection & Health
• Define clear Environmental policies in the form of
guidelines, standards and KPIs
• Ensure compliance to Environmental policies with
regular checks
• # of yearly inspected DC plant
• # of plants not complying with
Environmental Law 30/2002
Customers’
Protection
• Regulate DC tariffs to promote transparency and
fairness
• Ensure reliability of service to consumers
• # of complaints processed on DC tariffs
• # of DC tariffs reviewed
• # of yearly inspected DC plants
Energy Efficiency• Mandate DC to maximize DC penetration
• Establish standards and guidelines to ensure the
minimum DC plants requirements
• # of DC-mandated developments
• Potable water consumption for cooling
(Mm3/year)
• # of yearly inspected DC plants
Human Capital
• Ensure capabilities’ development of employees through
periodical trainings
• Retain capabilities with an appropriate team
management
• % of employees with at least 1 training per
year
• % of employees satisfaction
New Technologies
and Innovation
• Ensure a competitive market that enhances service
quality and technology innovation
• Promote innovation in DC solutions and foster energy
efficiency (e.g campaigns, workshops)
• # of DC promotion campaigns
• # of workshop sessions with DC
stakeholders
• # of R&D activities/ initiatives
KPIsDC Regulatory Actions1
2
3
4
5
Regulatory
Effectiveness• Ensure a positive impact of the regulation along the
different Strategic Objectives• % of Regulatory Effectiveness*
Proposed Strategic Objectives and DC Regulatory Actions
Proposed DC price regulation consists of 4 key pillars
Tariff Structure
Payment Schemes
Price Control Mechanism
Ownership Structures
• Description of the 3-tier tariff structure (connection, capacity and consumption charges) that will be adopted by DC Providers and DC Retailers
• Definition of payment schemes (who pays what and to whom) according to all the different types of contractual agreements between Real Estate stakeholders
• Development of the price control mechanism that will be adopted by the DC Regulator to control the DC Providers and DC Retailers’ tariffs in the market
• Overview and assessment of the different Government ownership structures that can be adopted in the future (from no asset ownership to full asset ownership)
Key Pillars of DC Price Regulation Description
1
2
3
4
Pillars of Price Regulations
DC sector potentially involves stakeholders and entities that may exchange services and monetary transactions
DC Provider
DC Retailer
Developer
Unit Owner
An entity that generates and distributes Cooling Energy by means of Chilled Water using a DC System to one or more DC Retailers and/or one or more Customers (who may be Developers, Unit Owners, Occupants or Tenants)
An entity that acquires cooling energy by means of Chilled Water from a DC Provider or DC Retailer for the purpose of selling to one or more DC Retailers and/or one or more Customers. A DC Retailer may also be a DC Provider
An entity that is involved in encompassing activities that range from the purchase of raw land, construction of real estate properties to the sale and/or lease of built developments or parcels to others (can be a master developer, developer, sub-developer or building owner)
An individual or entity that uses the Unit, either owning it (in the case of Occupant) or renting it from either a Unit Owner or from the Developer (in the case of Tenant)
An individual or entity that purchases a Unit from a Developer and owns the Unit. The Unit Owner is also the Occupant in case he uses the Unit (Unit can be a dwelling or a property for commercial use)
Occupant or Tenant
DC Operations Stakeholders
District Cooling Department
Mission & Achievements
The District Cooling Services Department came into existence with the resolution from council of ministry vide reference 825 dated 2nd May 2012.
Duties & Responsibilities
1. Suggest general policies for District Cooling.2. Set up rules and regulations for DC and ensuring that they are being complied with.3. Set up DC standards and specifications and ensure that they are being complied
with.4. Decide on areas to be served by DC as per priorities and visibility (economically) in
coordination with Concerned Authorities in the country.5. Suggest tariff structures for customers.6. Approve DC activities.7. Develop Integrated Programs of whatever related to District Cooling.8. Coordinate with the concerned authorities with regards to District Cooling.
District Cooling Department
Mandate
• (May 2012): District Cooling Services Department (DC) Established as Corporate Regulatory Body of Qatar General Electricity and Water Corporation – KAHRAMAA
• (May 2013): District Cooling Department (DC) Suggested Prohibition of Potable Water For Cooling Purposes and to utilize Treated Sewage Effluent (TSE) as suitable alternative cooling makeup (to Qatar Permanent Water Resources Committee- PWRC)
• (March 2013): Qatar Council Of Ministers Approved the Directive Of Prohibition of Potable Water For Cooling Purposes.
• (May 2013): KAHRAMAA notified over 53 District Cooling Operators on the Prohibition Directive and to utilize TSE for Cooling.
• (June 2014) Established effective District Cooling Stakeholders coordination and Conducted DC Workshop.
• (Oct 2015): District Cooling Department Developed the Regulatory Frame Work structure for District Cooling Services in Qatar by International Consultants Consortium.
• (May 2017): District Cooling Department Published the District Cooling Code as part of KAHRAMAA Published Contractual regulations.
District Cooling Department –Accomplishment Milestones
GCC District Cooling Committee
استحداث لجنة ضمن لجان ( 10/04/2017) بتاريخ كهرماءاقترحت األمانة العامة لدول مجلس التعاون للخليج العربي تختص بنظام
تبريد المناطق
Kahramaa proposed by ( 10th April 2017) introducing
District Cooling Committee within GCC Committees
KAHRAMAA Is currently developing Qatar District Cooling Law.
Anticipate to publish the 1st Version of Qatar DC Law by 2018.
District Cooling Law
Thank you Questions
Engineer :Ibrahim Mohammed A Al Sada
Manager: District Cooling Services Department
Qatar General Electricity & Water Corporation - KAHRAMAA