DUBAI // Homes and businesses with solar panels could soon provide energy for the rest of Dubai - and perhaps even get paid for it.
The Dubai Electricity and Water Authority (Dewa) is planning to recruit international consultants to look into the viability of such a plan.
In recent years, companies that generate electricity around the world have been setting up feed-in tariff schemes, where customers are paid for electricity they supply to the grid. Many include a premium rate for solar energy.
Saeed Al Tayer, the chief executive of Dewa, did not say whether that would happen in Dubai, saying a study was needed because such a scheme was yet to used in the Middle East.
"We need to have a specialised study in this respect," he said. "We have to get the legal and financial infrastructure in place in order to be prepared for solar customers."
The authority has set itself a target of getting 5 per cent of its energy from solar power by 2030.
Feed-in tariffs are already used in more than 50 countries and throughout the European Union.
The price paid to customers supplying the grid varies according to the technology used, with solar power carrying a higher price than wind power, because photovoltaic cells, which convert solar energy into direct current electricity, are more expensive.
There is a growing movement toward solar power, with facilities being installed at the Meydan racecourse and in Masdar City.
Mr Al Tayer said officials under his watch were collecting information on existing solar production in Dubai.
"There are a lot of solar projects here," he said. "The future business will be in solar. It's good for the customer, for business and for everybody. This is Dubai's strategy."
It is not cheap to set up, though.Roof-top solar panels for a home can cost up to US$10,000 (Dh36,700) to install, and take 15 years to pay for themselves.
Nor do the low electricity prices provide much incentive for home users. Hence, according to experts, the need for substantial payment for supplying energy to the grid.
"The installation of solar systems in homes and in small businesses is driven by government incentives," said Sander Trestain, the executive director for projects at Enviromena Power Systems, the company responsible for Masdar's 55-acre solar plant.
"You need to know that if you make an investment into a solar system you are guaranteed returns over a period of time.
"It's typically bought at a rate that's above that of the electricity that's coming out of your socket.
"That gives people an incentive to install solar panels on their rooftops. In places like Germany, the result is that there's a massive installed capacity of solar on residential rooftops."
If feed-in tariffs were on the cards, the price at which Dewa was willing to buy back energy should also be factored into a feasibility study, said Vahid Fotuhi, the regional director for BP Solar and the founder of the Emirates Solar Industry Association.
"It would work if the returns justify the investment," he said. "Part of the Government's effort in its feasibility study should be to understand what the incentive needs to be to consumers, in order to assess whether it's going to be attractive or not.
"It also needs to be attractive for the government in terms of subsidy and for the home-owner in terms of upfront costs."
Such payment schemes in Europe mean solar panels there pay for themselves in as little as seven years, making them a far more tempting prospect.
With panels lasting 25 years or so, a seven-year payback means 18 years of profit.
"You've paid for your system, and after seven years all the money you're making is just gravy," said Mr Fotuhi.
Other incentives - such as interest-free loans, rebates, low down payments and leasing options - could help, too, he said.
Even without any of these, demand for solar power is already growing among firms that rely on diesel generators because they do not have access to the main grid.
Karel De Winter, the division manager for supplier Alsa Solar Systems, said developments on artificial islands would also benefit.
"The UAE does have a genuine off-grid market," he said. "Slowly users of off grid power such as diesel will come to realise that it pays to go solar."