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Green market: making its way within the GCC countries

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With the background of the United Nations conference on climate change, COP 21, and the first of its kind forum organized in May 2015 by the World Bank in Oman – which gathered the GCC countries to discuss the role of clean energy in reducing fiscal pressures and improving economic productivity and competitiveness – it is the right time to point out that the Gulf countries, well-known for their oil or gas resources, are also active in the renewable and environmental sector.

Enjoying suitable geographic and climatic conditions, solar energy has a great potential in the region, one of the largest worldwide. Wind resources also appear to be quite important, as well as biomass from cities’ waste. Many projects in the renewable energy field have been undertaken for the last thirty years but a true expansion is noticed in the last decade.

The first explaining factor would certainly be the increase of energy demand. Thus, the impressively fast economic success of those countries has resulted in a more intensive use of energy. The annual growth rate of GCC’s energy consumption is around 8%, the generating capacity needs to be multiplied by two each ten years[1]. Besides, less hydrocarbons used for domestic consumption means more available resources for exportation. By investing in renewables, Saudi Arabia could save an estimated 690,000 barrels of oil a day[2].

Also, this field can represent a strategic investment as it may serve job creation and economic diversification. In fact, the hydrocarbon sector represents 47% of the total GCC countries’ GDP but it is only responsible for 1% of the jobs[3].  For all these reasons, financing renewable energy is sustainable in terms of return on investments.

In the United Arab Emirates, there is a will of creating cities functioning thanks to renewable energy sources. We could cite carbon-neutral Masdar City in Abu Dhabi and the building of the largest plant for photovoltaic generation on a global scale with a capacity up to 1000 MW. Dubai authorities want to triple the renewable energy to 15% in 2030[4].

As for Saudi Arabia, by 2030, the country could run one third of global Concentrated Solar Power plants. The use of hybrid fuel and solar plants is being investigated. Another objective is to make water desalination, which represents a significant part of the domestic electricity use, a solar powered process.

Concerning Qatar, one of the four main goals of QNV 2030 is environmental development. The construction of the city of Lusail, in the north of Doha, which began ten years ago is agood example of Qatar’s ecological concerns. It has been designed with a great deal of respect for the environment to meet the strictest green standards and has even been granted an award for its good practice.

 

[1] IRENA, International Renewable Energy Agency

[2] Green Prophet, Details Emerge of Saudi’s $109 Billion Solar Plan, June 2012

[3] Envirocities eMagazine, issue 1, January 2012

[4] UAE champions sustainable energy at UN, Permanent Mission of the United Arab Emirates to the United Nations, May 2015

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