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Will the Steve Jobs of cleantech come from Riyadh, Cairo, or Abu Dhabi?
The way it’s looking, the next major cleantech innovators are going to be from the Middle East, say experts.
The Middle East and North Africa region is home to some of the world’s most ambitious solar parks. The desert landscapes provide ample land and year-round sunlight for solar power production. Researchers believe massive solar parks in the region have the potential to produce four times the world’s present energy demand.
But, there’s a major problem—dust. Dust accumulation on solar panels restricts sunlight from reaching the electricity-generating cells.
“Every day you don’t clean, you can expect the solar energy production to drop by 0.5-1%. We call this the background soiling loss,” said Georg Eitelhuber, CEO and co-founder of NOMADD, in a press statement. “That’s just the daily background loss levels; after a bad sandstorm, the soiling loss can be as high as 60%. Regular cleaning keeps production at high levels each day.”
Saudi Arabian startup NOMADD, one of Fast Company Middle East’s Most Innovative Companies 2022 winners, has developed an autonomous waterless robotic cleaning solution to ensure that solar cells do not drop in efficiency.
Recently, NEOM, the giga-project under construction in the northwest of Saudi Arabia that aims to run on 100% renewable energy, has adopted the robotic cleaning solution to help realize its solar power generation ambitions.
In the last couple of years, entrepreneurs like Eitelhuber have found their inventive mojo, altering how we harness and deliver cleantech solutions, just as Steve Jobs fundamentally changed his industry.
From Riyadh to Cairo to Abu Dhabi, a new business landscape is emerging in the region’s cleantech ecosystem.
“I think entrepreneurs in the Middle East are excited about cleantech and are proposing solutions. What is needed is an ecosystem that adopts their innovations and provides them with the logistical and business support to succeed,” says Steve Severance, Director of Growth at Masdar City.
Apart from the governments in the region announcing a series of big-ticket projects to produce the kind of clean technology the region aims to promote, there has been a big push from startup accelerators, incubators, and big corporations.
Recently, DHL launched the Fast Forward Challenge: Sustainable Solutions for innovators. “The greatest disruption in the region will be about access to affordable energy and clean water. As a result, a growing number of startups in the Middle East are rising to tackle the growing climate crisis,” says Amadou Diallo, CEO of DHL Global Forwarding MEA.
Jon Blackburn, PwC Middle East partner, Energy, Utilities, Resources and Industrials, says pioneering climate tech will unlock major solutions to tackle climate change. “The Middle East is one of the most vulnerable regions in the world to the impact of climate change but it’s also where some of the most exciting innovation in climate tech is taking place.”
As part of its COP27 activities, PwC Middle East launched NetZero Future50 initiative to identify innovators developing technology aimed at reducing emissions and accelerating decarbonization. “Through this initiative, we see a new generation of entrepreneurs in the region coming through with that ‘innovative mojo’ helping to tackle the climate challenges facing our region,” adds Blackburn.
Big corporations must support the cleantech ecosystem and collaborate with all stakeholders to make cleantech affordable and accessible to enable sustainable living, and a sustainable economy, adds Diallo.
MAJOR AREAS OF INNOVATION
Many clean technologies are proven at scale by Masdar city that allows rapid and agile R&D of renewable energy and sustainable living models. Its initiatives, such as The Zayed Sustainability Prize and the Zayed Future Energy Prize, have played a significant role in promoting regional and worldwide startups to develop sustainable, innovative solutions.
Some startups incubated at Masdar city are turning food waste into animal feed, like Circa Biotech, and turning industrial waste into pavers, like Seramic. Then there’s an e-scooters startup that offers clean transport solutions and a startup called De L’Arta that produces cosmetics from local plants that grow in seawater.
“We are seeing a lot of innovations in EVs and autonomous transportation,” says Severance. “Masdar city is focusing on hydrogen. We must achieve carbon neutrality in many areas, and we need a breakthrough in hydrogen storage and finding solutions for transporting goods over long distances.”
The ecosystem requires SMEs and big companies to create the environment for such innovations to thrive, in addition to government efforts that would regulate the framework for such efforts, he adds.
King Abdullah University of Science and Technology (KAUST) has been at the center of the flourishing entrepreneurial ecosystem in Saudi Arabia. Apart from NOMADD, RedSea, the agritech firm that created a sustainable desert agriculture system using 90% saline water, and Polymeron, which converts date waste into degradable bioplastic, were incubated in KAUST.
Few of these new startups will become the next big thing, says Hattan Ahmed, Head of the Entrepreneurship Center at KAUST, in an earlier interview with Fast Company Middle East. “A good number of startups that KAUST accelerated are focused on creating global impact.”
“KAUST’s global reach to hot entrepreneurial nodes provides access to remarkable founders addressing significant global challenges,” adds Ahmed.
In 2021, Changelabs, in partnership with the Green for Growth Fund (GGF), an investment fund supported by the likes of IMF and Deutsche Bank, launched Scale Up To Green accelerator targeting top Egyptian resource eﬃciency, green energy, and agritech companies.
From fashion and furniture to energy and industrial waste – startups like Mostafa Hemdan’s Recyclobekia, which produces recyclable material from electronic waste; Rania Rafie and Yara Yassin’s Upfuse transforming plastic bags into fabrics; Ahmed Raafat and Nour El-Assal’s Tagaddod converting cooking oil to make biodiesel, and Hend Riad and Mariam Hazem’s Reform Studio creating furniture out of plastic waste, are some of the hundreds of startup companies disrupting different sectors in Egypt.
Meanwhile, giga-projects like NEOM in Saudi Arabia are bringing entrepreneurs, business leaders, and companies together to innovate and build new technologies and businesses in ground-breaking ways using 100% renewable energy and with sustainability as a key objective.
CHANGING THE INDUSTRY
But will the solutions coming from the region fundamentally change the industry?
“The Middle East has already achieved that. Currently, the cheapest energy on Earth is coming from the Middle East, and it is not oil, but solar,” says Severance.
“We went from a point where solar energy price was 40 cents per kilowatt hour to its current pricing at 1.35 cents per kilowatt hour, so there has been a 95% reduction in the price of solar energy.”
With several governments across the Middle East banning the use of single-use plastics, there is an opportunity for entrepreneurs to come up with new sustainable packaging solutions, especially for the rapidly growing e-commerce sector. “We can see new solutions, ranging from using bio-based materials to creating truly reusable packaging,” says Diallo.
In the Middle East, Blackburn says, investment is generally heading into development of technologies where the most focus on greenhouse gas emissions (GHG) is needed. “Our data shows that almost two-thirds of investment is going into sectors that generate 85% of GHG emissions.”
“It is more nascent in the region but will eventually come with growing demands for GHG capture, removal and storage as well as climate change and reporting management. This shift is one of the top agenda items for business leaders.”
With Egypt hosting COP27 last year and the UAE hosting the climate summit later this year, there’s a massive opportunity for the region to benefit from increased investment from across the globe, kickstarting clean energy initiatives.
For instance, Masdar city’s startup accelerator program, The Catalyst, provides funding up to $200,000, research and development space, training, and mentoring. It is a comprehensive ecosystem, and while a lot of the innovation comes from startups and SMEs, large companies have the logistics needed for the ecosystem to be complete.
The cleantech industry in the region has advanced remarkably, says Severance. “When Masdar City was launched 15 years ago, people would ask: ‘Why are you so concerned with sustainability?’ Well, now you cannot deliver a building in Abu Dhabi without applying the Estidama sustainability standards.”
Even DHL, Diallo says, is stimulating a circular economy with the logistics support it provides to startups such as Rebound that enables better utilization of used plastic. And Amazon Web Services launched the Clean Energy Accelerator 3.0 in 2022 to facilitate partnerships with mature startups developing breakthrough clean energy technologies.
Undoubtedly, cleantech requires a confluence of ideas from entrepreneurs, accelerators, and big organizations to transition from ideas to concrete commercialization.
SMEs in MENA are driving innovation and competition. According to the IMF, SMEs in the Arabian Gulf contribute 15-30% of the GDP. In the UAE, SMEs represent 94% of the companies and institutions operating, contributing more than 50% to the country’s GDP. In Saudi Arabia, SMEs jumped by 9.3% in the third quarter of 2022, driven by a healthy entrepreneurial ecosystem.
And when they are developing renewable energy and sustainability solutions, the power of the cleantech entrepreneurs–especially one with an innovative and truly disruptive idea, is enormous.
“Although the cleantech startups still have a long way to go,” Severance says, “they are taking the first step towards a more sustainable industry.”
The devastating impacts of climate change are becoming a fact of life, but when we find and encourage the Steve Jobs of cleantech, wherever they may be today, racing to achieve net-zero emissions targets will be easier.