District cooling heats up

District cooling is a multi-billion dollar industry in the Middle East, with demand climbing and no sign of a slowdown in sight. Tildy Bayar takes a look at the significant players and projects driving this booming sector.

District cooling systems deliver chilled water from a central plant through an underground pipe network to multiple buildings. The water circulates through refrigeration coils, or enters the air conditioning system through absorption chillers. The energy needed to drive the chillers can come from multiple sources including waste heat from power plants or industrial processes; steam turbines, or electric chillers. The cooling water can be fresh water, seawater or treated sewage effluent (TSE), a relatively new source of cooling water within the industry.

According to the United Nations Environment Programme (UNEP), district cooling can be more than twice as efficient as traditional decentralised air-conditioning methods, and can reduce electricity use significantly during peak demand periods through decreasing power consumption and use of thermal storage. District cooling systems can also be less costly than using electricity to run compressors for cooling.

While district cooling systems can replace any traditional cooling method, their biggest competitors are air-cooled reciprocating chiller systems designed for buildings with high power demand.

According to a history of the district cooling sector compiled by George Berbari, CEO of UAE-based DC Pro Engineering, the first centrifugal water-cooled chiller was developed by one Dr Willis Carrier in 1922. The technology subsequently became the most widespread in the sector and led to the world’s first district cooling scheme, installed at the Denver, Colorado Automatic Refrigerator Company in the US in 1889. During the 1930s, New York City’s Rockfeller Centre and Washington DC’s US capital buildings featured district cooling systems.

Dubai's d3 design district
Dubai’s d3 design district
Credit: IDEA/d3

Today district cooling has become a multi-billion dollar industry, with global demand for cooling continuing to rise. According to the International Energy Agency (IEA), power consumption for space cooling grew by 60% worldwide between 2000 and 2010.

In the Middle East, centralised chilled water plants have been in use since the 1960s. According to Berbari’s history, the region’s first commercial district cooling scheme was developed by the UAE’s National Central Cooling Company (Tabreed) in conjunction with the UAE Army at Zayed Military City in Abu Dhabi. The scheme’s natural gas-driven centrifugal chillers, the region’s first, were built by Caterpillar, with research funded by the US Gas Research Institute.

‘From strength to strength’

The Middle East as a whole installed 75.5 million square feet (7 million m2) of district cooling capacity in 2014, according to the latest figures from the International District Energy Association (IDEA). And, according to market forecasts, the region’s district cooling market is projected to grow by more than 16% over the coming five years.

Ahmad Bin Shafar, CEO of the Emirates Central Cooling Systems Corporation (Empower), has described the regional market as ‘going from strength to strength’.And it is easy to see why with an ever-growing list of large-scale projects, increasing integration of new buildings with cooling networks, and profits reports such as July’s strong performance by Tabreed, which reported a 3% net profit increase to AED153.4 million ($41.7 million) in the first half of this year. In January the firm refinanced over $707 million in debt, and reported that 2014 had seen it add 118,000 refrigeration tonnes (RT – a measure of the amount of heat removed) to its cooling networks in the UAE, Saudi Arabia, Qatar and Bahrain. Tabreed operates over 60 district cooling plants, delivering over 684,000 RT in Abu Dhabi and over 950,000 RT to the entire Gulf region, according to the company’s figures.

Meanwhile, Empower, which boasts a total cooling capacity of 1 million RT, announced in February that its 2014 net profit was AED410 million, an increase of 65% over 2013 figures. Its total revenues in 2014 amounted to AED1.50 billion, a 76% year-on-year increase.

Champion coolers

In February, UNEP identified 45 ‘champion cities’ for district energy use around the world. While for most of these cities the main concern is district heating, for three notable examples in the Middle East – Doha, Qatar; Dubai, UAE; and Kuwait City, Kuwait – the focus is on district cooling.


According to UNEP, air conditioner use accounts for 70% of Dubai’s electricity demand. In order to reduce its energy use, the city has developed the world’s largest district cooling network, providing 1 million RT per year and attracting over $150 million in investment between 2009 and 2014. Through this network, Dubai is on track to achieve its goal of meeting 40% of its cooling demand through district cooling by 2030. Meeting this target is expected to reduce the city’s power consumption for air conditioning by 50%.

In addition, Dubai has targeted a 20% reduction in building energy use, a 30% reduction in energy demand, and 5% of renewable energy in its power mix by 2030. The city also aims to incorporate thermal energy storage into all new district cooling plants, representing at least 20% of the design capacity of the plant, by 2030. Increasing the use of TSE instead of fresh water in district cooling systems is also a stated aim, although there is no set target for this.

In a significant current project, Empower is set to provide a total of 120,000 RT in district cooling services for property developer Tecom Investments’ Dubai Design District (known as ‘d3’), an urban design centre which will house art galleries and fashion and luxury outlets. Work began on the Dhs750 million ($204 million) project’s first phase, providing 10,000 RT, in November 2014, and its completion was announced in March.

The two district cooling plants with thermal storage used in the d3 project use TSE for cooling rather than fresh water, as part of Empower’s sustainability strategy and in line with Dubai’s environmental goals.

Jumeirah Emirates Towers
Jumeirah Emirates Towers
Credit: Jackardsiffanton/Wikimedia Commons

In June, Empower announced the opening of a new Command Control Centre, powered by Dubai’s communications infrastructure, to remotely monitor 26 of its 62 existing district cooling plants. Currently, the Centre monitors district cooling in 350 buildings through 10,000 single-unit meters, Empower says. In line with the firm’s plans for future expansion, the Centre has the capacity to monitor an additional 74 plants, or around 650 more buildings and 90,000 more meters.

In February, a retrofit connected Dubai’s huge Emirates Towers development to Empower’s district cooling network. The Emirates Towers complex includes two of the world’s tallest buildings, the Emirates Office Tower (355 metres) and the Jumeirah Emirates Towers hotel (309 metres). The project replaced the complex’s existing air-cooled systems with a connection to Empower’s 6000 RT system.

The new cooling system will use 0.9 kW of electricity per hour, as compared with the conventional cooling system which used 1.7 kW per hour, Empower says. This is expected to save around 80% in energy costs for the property.

The retrofit constitutes phase one of a planned 30,000 RT project which will include cooling system renovation on residential and commercial buildings such as the Burj Al Arab hotel, the Jumeirah Beach hotel, the Emirates Academy of Hospitality Management and the Madinat Jumeirah resort, Empower says.

And Dubai’s district cooling capacity is set to keep pace with growing demand in the coming years. Empower reported in July that it plans to expand its district cooling transmission pipeline in the city to over 225 km by the end of this year, while Emirates District Cooling (Emicool), which operates six plants, reportedly plans to increase its capacity by over 50% to 500,000 RT to meet the expected demand from development related to Dubai’s hosting of the World Expo in 2020. In the next five years, a construction boom with estimated investment of $7.1 billion is expected in relation to the event, which could see up to 25 million visitors. Emicool currently provides 115,000 RT from its largest plant at Dubai Investments Park (DIP), but has said it plans to increase the plant’s capacity to 250,000 RT in line with DIP’s expansion plans. The firm also offers cooling services to Dubai Motor City, Dubai Sports City, Uptown Mirdiff, and the Palazzo Versace hotel and D1 Tower at Al Jaddaf.

Saudi Arabia

District cooling is also big business in Abu Dhabi, Qatar and Saudi Arabia. Indeed, growth in Saudi Arabia’s district cooling market is set to jump ahead of current world leader the UAE, according to market analysis from Frost & Sullivan. A recent report values the Saudi district cooling market at $468.2 million, with an installed capacity of 1.25 million RT. The report attributes the expected growth to several main market drivers: an ongoing construction boom; the use of innovative technologies; a growing demand for energy efficiency in cooling; and government stimulus through the Saudi Industrial Development Fund.

In 2010, the Saudi Council of Ministers established the Saudi Energy Efficiency Center (SEEC), which promotes energy efficiency labeling for the air conditioning sector, among others. Local governments have followed suit, for example with the Riyadh City Development Council specifying that district cooling solutions are to be used for all of the city’s large developments.

While the Saudi market is dominated at present by cooling for commercial offices, Frost & Sullivan predicts that the retail sector will catch up, with a 30% market share by 2016.

Kumar Ramesh, Frost & Sullivan’s industry manager, environment and building technologies, Middle East and North Africa, commented: ‘Saudi Arabia has become one of the most attractive district cooling business hubs with 26% market share compared to 74% of all the other Gulf Cooperation Council countries put together.’

Tabreed’s Saudi arm, Saudi Tabreed, has undertaken a 35,000 RT district cooling project at Riyadh’s King Khalid International Airport, which will involve integrating a new plant with an existing facility. The project is expected to be completed in 2017, at which point the existing plant will be phased out.

Saudi Tabreed also won a contract to design and build a 100,000 RT district cooling network for the office towers of Riyadh’s King Abdullah financial district, including a 10-year operation and maintenance plan.

Oil company Saudi Aramco hosts a combined heat and power (CHP)-based district cooling plant at its headquarters in Dhahran. The plant produces 27,000 RT and 35 MW of electricity. In December 2014, Saudi Tabreed’s subsidiary the Saudi Dhahran Cooling Company awarded a $30.6 million contract to expand the Aramco district cooling plant to produce an additional 5000 RT. The new plant is expected to open in March 2016.

In addition, another Saudi Tabreed subsidiary, the Central District Cooling Company, has awarded a $40.2 million contract to expand its Jabal Omar district cooling scheme in Mecca with an additional 10,000 RT. The scheme delivers 55,000 RT to 13 towers housing hotels, malls, commercial outlets and residential buildings. Saudi Tabreed said the scheme is expected to bring the buildings’ power consumption down from 595 kWh to 353 kWh.

In July, Mitsubishi Heavy Industries (MHI) announced that it had received an order for 80 units of its large-scale centrifugal chillers for a district cooling plant associated with an urban development project in Medina. The plant is expected to provide 200,000 RT to an area of 1.6 million m2. Delivery of the chillers is scheduled for this autumn, MHI said.


In Qatar, Doha’s Integrated District Cooling Plant (IDCP) on the 4 million m2 man-made Pearl-Qatar island, home to riviera-style cafes, restaurants, shopping centres and 45,000 residents, runs on electric chillers and is the largest of its type. Commissioned in 2010, the plant supplies 130,000 RT.

The plant is operated by district cooling firm Qatar Cool, which was the 2014 winner of IDEA’s ‘Space Award for total area committed’ and ‘Space Award for total number of buildings committed’ to district energy.

Currently, Qatar Cool is expanding its district cooling plant in Doha’s West Bay neighbourhood. West Bay, which features some of Qatar’s tallest skyscrapers housing luxury apartments, high-end offices and hotels, is already served by two of Qatar Cool’s district cooling plants which supply a combined capacity of 57,000 RT to around 46 towers. Once online in the third quarter of 2016, the third plant’s 14 chillers and thermal energy storage tank are expected to bring the company’s total offering to around 40,000 RT. Qatar Cool announced this summer that it is increasing the capacity by an additional 25,000 RT in the second phase of the third plant’s development, noting that when online, the plant is expected to reduce the neighbourhood’s energy use by 40%-45%.

In 2013, Qatar Cool’s West Bay cooling supply exceeded 170 million RT, the company said, representing around 120 million kWh in savings over conventional cooling methods.

Technology issues

While district cooling’s future looks bright, there are still some issues for the industry to work out. For example, the theme of this year’s Middle East District Cooling Summit, to be held in Doha in November, is the potential danger of stagnating technology development in the sector.

Berbari, the Summit’s co-chair, has called the industry’s lack of technology development over the past 10 years ‘worrying’ and has noted that technological advancements have come almost exclusively in the form of chiller manufacturers’ improvements to their products’ efficiency. District cooling suppliers, he says, are focused instead on expanding their networks and growing their businesses. According to Berbari, the sector’s slow technology evolution could see it face increased competition in future from new, ultra-efficient decentralised cooling systems.

Some major firms seem to be taking note. One company that is working on technology development is Tabreed, which has partnered with the Masdar Institute of Science and Technology on a joint R&D project which aims to create a ‘smart controller’ capable of managing district cooling plants to improve operational performance and decrease energy consumption, with minimal need for human input.

Tabreed and Masdar aim to develop a software module that can be integrated with a district cooling plant’s control system to measure the variables that impact a plant’s operational efficiency, such as chilled water supply, return flow, outside temperature and humidity levels. The system will then automatically decide at what capacity major equipment such as chillers, water pumps and cooling towers need to operate in order to meet customers’ cooling requirements in the most economic and energy-efficient way. One of Tabreed’s plants in Abu Dhabi’s Mohammed bin Zayed City has been selected for the pilot project.

The use of TSE in the Middle East’s district cooling plants is increasingly popular as it saves valuable fresh (desalinated) water for other purposes. However, it is not without its issues, including TSE use in agriculture during the summer when cooling demand is also high, leading to potential resource conflicts.

According to a paper by US-based water treatment firm Nalco, the advantages of TSE include cost reduction by a factor of six over the use of desalinated water, availability and compliance with sustainability laws. The disadvantages include issues around water quality such as corrosion, phosphate deposit formation, and health issues and slime formation associated with microbes. The paper also said TSE can lead to water quality fluctuations and system adaptation issues.

Qatar, Saudi Arabia, Bahrain, Abu Dhabi and Dubai have all recommended or passed legislation mandating the use of TSE in district cooling.

Berbari has noted that district cooling in Abu Dhabi now uses almost 100% TSE. Qatar is expected to achieve a similar figure by the end of this year, with Saudi Arabia coming up fast at 60% and Dubai at 30%. Berbari predicts that around 70% of district cooling plants in the Gulf region will use TSE by 2018.

In June, Empower reported that use of TSE in its district cooling plants had saved 194 million gallons (882 million litres) of desalinated water in 2014. The firm said it has switched to using TSE in all of its older plants.

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