Energy demand for air conditioning in the GCC, currently accounting for 70 per cent of the region’s annual peak electricity consumption, is expected to nearly triple by 2030, requiring fuel equivalent of 1.5 million barrels of oil per day, a study showed.

Booz & Company, a management consulting company, argued that given the escalating power demand, there is a strong need for GCC governments to incorporate district cooling into their urban planning so as to further ensure sustainable economic growth

“If implemented under the right conditions, district cooling could effectively serve 30 per cent of the region’s cooling requirements by 2030,” Booz & Company said its study.

The study pointed out that if the region maintains its existing pattern of cooling technology deployment with heavy reliance on conventional cooling technologies, the GCC will have to invest approximately $ 100 billion for new cooling capacity and over $ 120 billion for new power capacity by 2030.

“Over the next 18 years, air-conditioning will account for 60 per cent of additional power generation required in this part of the world,” it said.

“However, there is an alternative option. By pooling demand for air conditioning, district cooling is significantly more cost-effective over the long term than any other system currently being employed at the individual building level. It also has less negative environmental impact than conventional solutions,” said George Sarraf, partner with Booz & Company.

“With these countries likely to urbanise further in coming decades, district cooling could save them from investing considerable sums on new power stations.”

The study pointed out that at present, district cooling is one of three main systems used for air-conditioning in the region. The two others include conventional window units or split systems as well as central air or water-cooled chillers. In contrast to those systems, district cooling is decentralised, and involves central plant supplying chilled water through a network of pipes to multiple buildings within a local area.

“In district cooling, the network entails an important additional cost which, on a “per-user” basis, decreases with increasing real estate density, and can be offset by the higher efficiency of the system,” said Dr Walid Fayad, partner with Booz & Company.

The study outlined the three main advantages of district cooling system. These include typically 40 to 50 per cent less energy for every refrigeration ton hour than conventional in-building technologies, more efficient capacity use, and peak-period saving potential.

The study argued that based on existing development plans and estimated density patterns, district cooling could play a particularly important role in the future of GCC countries.

By 2030, consistent use of district cooling in the region could lead to a reduction of 20 gigawatts in new power capacity requirements — the equivalent of 10 large power plants. It will also result a reduction in the GCC’s power plant fuel consumption equivalent to 200,000 barrels of oil per day, in addition to a region-wide decrease of 31 million tonnes per year in carbon emissions.

“From a qualitative perspective, district cooling offers a more reliable service because of on-going professional operation and maintenance,” said Tarek El Sayed, principal at Booz & Company. “Also, the system is quieter than conventional cooling systems and more visually appealing as it is located remotely rather than on the roof of a building.”

According to the Kuwait Financial Centre, or Markaz, electricity demand in the GCC countries is expected to grow at between seven per cent and eight per cent annually over the coming years, and the member counties are expected to spend $ 45 billion until 2015 in order to add an additional 32,000 MW of capacity.

Power consumption across the GCC has grown at an annual rate of about nine per cent from 2002; Saudi Arabia and the UAE account for a combined 75 per cent of the total GCC consumption, Markaz said.