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‘District Cooling is not necessarily a five-figure plant’

Sekhar Reddy V, General Manager, MBM Gulf Electromechanical, speaks to Surendar Balakrishnan on market conditions and why he believes District Cooling is the future. Excerpts from the interview…

| | Sep 15, 2019 | 9:36 pm
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Sekhar Reddy V,

How do you read the market in the GCC region?

Currently, the market is challenging, given the global and regional situation. The events unfolding in other parts of the world are having an impact, and that way, the GCC region is no more a protected economy. A lot depends on the regional and world situation for the GCC region to perform consistently. As construction is a forte of Dubai, in particular, the impact is showing not in terms of projects but in terms of do-ability. I am referring to commercial and financial issues.

The current market situation is such that the levels of understanding are not in tandem with the vision of growth. There is a lack of motivation to proactively approach deadlines.

Given the circumstances, what are the objectives of MBM Gulf Electromechanical?

MBM is a growing organisation, which has ticked all the right boxes for making it an all-round MEP company, right from engineering to execution and from handing over to post-handover FM.

The current market is short of good hands, given that many of the stalwarts have got decimated due to the rundown of the market and also the exploitation of this particular key segment of the industry. The vision of MBM is to have sustainable growth with good and sensible management of both the deliverables and the wellbeing of the company.

Could you elaborate on the rundown you speak of?

The rundown is overall. Why blame somebody when you book something – it is both ways. At the end of the day, it is a chain, and MEP has the biggest say in the building industry. And the first to get affected is this particular field, right from the product delivery to the supply chain to all the associated agencies required to accomplish the tasks. This being a major segment in the industry, any shortfall will have a telling effect on all the concerned aspects, including the end product.

I have said this before, and I will emphasise that MEP contracting is a very specialised field, wherein one wrong move will continue to affect the end result. So, it is very essential that the seller, the buyer and the beneficiary – the building owner – have a good understanding of what they are getting into and what they could expect, once it is ready for use. So, it is the responsibility of all the stakeholders to ensure that the requirement is well understood and delivered.

What is MBM’s strategic approach to project management and to a holistic treatment in ensuring optimal building performance, in terms of energy efficiency, reliability, IEQ and refrigerant use?

MBM has many portfolios, including MEP, ducted pre-fabrication workshop, ELV systems, FM, technical supply chain and civil works. With such a complete set of disciplines, it can offer a one-stop solution for a reasonably sized venture, right from engineering to handing over.

How does it place you at an advantage?

With many of the well-known MEP companies biting the dust, there are very few players in the market with this sort of backing. And this is where MBM has all the ingredients to be a preferred and acceptable contractor in the region. Also, given its sound financial position and the fact that it is part of a well-known group of companies, it certainly will do well but subject to how smartly it handles the dynamics of the market.

What is the path ahead for District Cooling in the region? What is the optimal financial model? And what technological aspects should the region consider in ensuring that District Cooling finds a strong footing?

District Cooling is the future. With so much emphasis being placed on energy management, green technology and climate control, it certainly has a huge role to play in a world-class economy like the UAE or the Middle East, in totality.

I do believe District Cooling is a requirement and not a luxury. The innumerable advantages District Cooling has over other systems have been undermined by poor implementation, lack of forethought and also, to a certain extent, the market dynamics, which have had a role in discouraging people from actively using it for the benefit of the region.

Would MBM be getting into District Cooling?

Certainly.

What is your exposure to District Cooling as a company?

We were associated with all the big companies that were doing DCPs, as a support element in installation, so it is a question of adding up the management segment to carry out the same works, but as a lead company.

A well-planned approach with good forethought will certainly help us see the benefit of having a District Cooling plant as against conventional systems. It makes sense commercially to opt for District Cooling, which I believe is an excellent tool not just for emerging management but also in terms of architectural friendliness. It gives flexibility to the architect for using space that otherwise would have been used for providing conventional systems within the property. Also, the end user benefits from a much less complex and rewarding cooling system.

Isn’t establishing a reticulation network prohibitively expensive, though? Doesn’t it go against the wisdom of risk assessment in an environment of growing financial uncertainty?

District Cooling is not necessarily a five-figure plant. It could be packaged and made modular, and the sizing of the plant could complement the progress of the particular development. I advocate phased development of District Cooling. The idea could be conceptualised for anything 10,000 tonnes of refrigeration (TR) in capacity, or above, which in my view is an acceptable number for the current size of major developments happening in the region.

What should be the broader policy approach to improving the state of the MEP discipline in the region? What needs to be done to protect the community in terms of fostering a balanced environment in the drafting of contracts and ensuring timely and as-promised payments?

I agree with you that MEP must be given an independent portfolio and not necessarily treated as part of the structure of the building. That is, the builder’s works and the MEP works are on the same level and on the same platform. That way, the engineer gets the same leverage instead of the current pyramid approach. This would help in not only getting the best return for money but, at the same time, a good product for the end user and would also take care of the environmental challenges.

The current set up is greatly affecting the products outcome, and definitely it is going to hurt the product and the economy. It must be given its rightful place in the industry, and for this, the client/developer and the professional management team must place trust in this sort of a set up. And definitely, the returns will outweigh the efforts. It is important that the layers of mistrust and communication gap are removed, allowing the industry to do well and prosper.


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