UAE solar SMEs in need of support

Small businesses in the solar energy sector are key to helping the UAE meet its clean energy targets, but they need more support to meet their full potential, according to experts.

Dubai aims to generate 15 per cent of its power from renewable energy sources by 2030.

“The Dubai government can take amazing risks, and they do – but it has to penetrate all the way down to the SMEs,” Imtiaz Mahtab, president of the Middle East Solar Industry Association (Mesia), said at an industry conference in the emirate on Tuesday.

Under the first initiative in the Shams Dubai programme, a five-prong approach aimed at making emirate one of the cleanest, smartest cities in the world, the government opened the door for private companies to generate solar power for residential and commercial entities. However, a track record is required for any company to enter its solar sector.

“An SME can’t set up a manufacturing plant for a technology that isn’t proven,” said Mr Mahtab. “So [instead] the place they’ll come in is to install projects or by partnering with someone that has the experience.”

Ali Abdel Hafiz, chief executive of the renewable energy start-up iSolarWorkx, said there was a need for a more collaborative network between governments, funds and universities. “I don’t think that there’s a lack of money or bright minds, it’s just a matter of organising this so that the technology can actually flourish,” he said.

Mr Hafiz described his arduous road to getting his educational renewable energy DIY kits into the market, a struggle that is still ongoing. Mr Hafiz started his company in May and needs to raise US$500,000 by November to begin manufacturing his product. So far he has been able to raise around $100,000 from angel investors.

But even in regions where legislation is clearly defined, small businesses have a high fail rate. A Bloomberg study conducted two years ago said eight out of 10 start-up businesses failed within the first 18 months. And the solar industry, particularly for this region, is still in its infancy.

PTL Solar, a small photovoltaic manufacturer from India, said that venturing into the solar sector was different than other established industries. “The business model in today’s solar industry is unlike any other industry where you try to reap profits in one to two years,” said Prabish Thomas, the chief executive of PTL Solar.

“To be a successful entrepreneur, it’s the will, a lean model and being innovative so that you’re able to somersault and meet the needs of your customers.”

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LeAnne Graves

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