Women in Energy: In conversation with Ayla Majid on being an investor and decarbonizing the Middle East

29 Mar 2024

In the dynamic landscape of energy transition, individuals like Ayla Majid emerge as pivotal figures, catalyzing transformative shifts towards sustainable energy practices. As the Founder & CEO of Planetive Middle East and Planetive Pakistan, Ayla brings to the forefront a wealth of experience spanning two decades in investments and financial advisory. With a keen focus on the energy transition sector, Ayla has ascended to prominence as a leading strategist, investor, and M&A expert with a specialized focus on emerging markets. 

Find out more about her journey and insights as we dive into Ayla's perspectives on the evolving energy landscape within the Middle East and Pakistan, shedding light on the strategies, challenges, and opportunities that define the path towards a more sustainable energy future.

What do you think is the future of energy transition?
 
The future of energy transition includes increased renewable energy integration, advancements in energy storage technologies, electrification of transportation, energy management systems, and greater emphasis on energy efficiency measures. Additionally, there will be a greater effort towards a shift away from fossil fuels towards decarbonisation of existing energy/fuel sources, and adoption of cleaner alternatives such as hydrogen and biofuels.

Collaboration and integrated policy frameworks will play crucial roles in driving this transition. All of this will be accelerated with innovation and investment in research and development. Overall, the future of energy transition holds the promise of a more sustainable and resilient global energy system with energy access for all with reliability and affordability.

How did your interest in energy begin?

Right after college, I was doing a lot of project restructuring, M&A work, and investment work. But over time my work has graduated and evolved into addressing challenges of all the sectors that I work with.

As part of my work, I was looking at structuring projects, developing projects, raising finances, and then working with other industries that gave me a very good lens to look at things in a very ballistic manner, such as understanding how one sector or one industry impacted the other.

Then I had the chance to start working in the governance sector by being part of both state-owned companies and public listed companies as well. I started my board journey back in 2009, where I saw so many challenges at the governance level. It was very clear that the world had moved towards a more sustainable way of doing business, and in particular energy.

What is the hydrogen strategy in the Middle East?

The Middle East is strategically position to emerge as a leading player in the hydrogen industry. With abundant resources including wind, solar, and other renewables, the region boasts potential to serve billions of people. Over the next decade and beyond, as the world increasingly relies on hydrogen as a key energy source, the Middle East is poised to become a key player.

Central to the Middle East's strategic vision is the integration of existing industries with the utilization of hydrogen, capitalizing on its versatility across various sectors within the region. With aspirations of becoming a major exporter of hydrogen, the Middle East aims to play a pivotal role in shaping the global hydrogen market landscape.

Can you elaborate more on what you recommend is the right hydrogen strategy for the Middle East?

The Middle East holds a distinct advantage and stands poised to lead in hydrogen fuel production and adoption. It possesses all the necessary prerequisites: abundant sunlight, ample land, access to water, and proximity to major demand centers.

It is imperative for Middle Eastern countries to establish sustainable long-term demand and supply management strategies, incorporating the adoption of new technologies and facilitating integration of hydrogen fuel across industrial sectors through cohesive policies and planning. Given the substantial infrastructure and logistical requirements of hydrogen fuel adoption, investments in these areas are crucial. This can be achieved through initiatives such as developing hydrogen production and consumption clusters and ongoing investment in technological advancements, enabled by a clear vision of long-term demand and offtake.

How can it export when there's still not a lot of infrastructure?

Hydrogen transportation encompasses a variety of methods. One notable approach involves utilizing derivatives such as ammonia, which are already being efficiently shipped via vessels across oceans.

Furthermore, on-land transportation of ammonia is a common practice. Another viable avenue for hydrogen transport is through pipelines, although the necessary infrastructure for this is currently lacking. Nonetheless, exploring the feasibility of implementing smaller-scale pipeline networks is imperative.

While constructing pipelines on a transcontinental scale, particularly towards Europe, presents significant challenges, leveraging existing infrastructure remains a pragmatic consideration.

And so, substantial investment is currently being directed towards the development of hydrogen fuel carriers capable of efficiently transporting large volumes of hydrogen at scale. Efforts are currently underway to retrofit vessels to accommodate this demand.

What kind of strategies is Pakistan taking or implementing that bring the country closer to the energy transition?

First of all, I must accept that our existing energy mix is not great. We are primarily dependent on fossil fuels, and a large part of that is imported. 60% of the energy that is generated within Pakistan comes from fossil fuels. A large part of that is imported fuels. Then we have about close to just about 30% of hydro and hydro, of course, that is seasonal and then we have about close to 5% wind and solar, and then the remainder is nuclear.

Therefore, in terms of renewables we have very low capabilities. Our existing infrastructure has limited capacity to sort of integrate additional renewables because they are in certain areas and not available everywhere. 

The government on the other hand is developing the transmission plan which will align with the generation plan. The challenge is that the interest rates within the country are super high which will make a lot of projects unviable. So obviously, when the interest rates start to lower down, then we will see more funding for renewable projects. 

These were all on-grid projects, but the off-grid projects in Pakistan are an exciting space. Alot of homes and industries are moving towards solar, this energy is abundant in Pakistan. The Government had given a really good incentive scheme, but because of fiscal pressures, they have stopped that. 

I think the scale is very rapid, and also because of our energy costs the grid energy cost is becoming expensive because a lot of that is coming from imported fuels so more people are looking to go off-grid. 

How do you think technology will help in energy transition?

In the face of challenges like resource constraints, time limitations, and supply chain disparities, achieving both present and future energy transition goals demands leveraging and accelerating adoption of innovative technologies. This includes optimizing current energy systems, incorporating new fuels like hydrogen, biofuels, deployment of BESS, exploring new materials, and enhancing existing infrastructure through technology and innovation. We are very lucky to be living in a time where there are so many exciting technological possibilities!!

 Ayla Majid and many others will be speaking at Middle East Energy, the region's most anticipated energy event is all set to be back with its 49th edition, running from the 16th to the 18th of April 2024 at Dubai World Trade Centre.

The flagship energy event of the year will be the epicenter of opportunities for energy professionals from all over the world! And keeping in line with COP28, Middle East Energy 2024 will be bigger, better, and more focused on sectors that will cater to your energy needs.

This year Middle East Energy advocates how renewable energy, energy storage and digitalization are key to optimizing the region’s power ecosystem and ensuring self-sufficiency. Register now!

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