More investment in GCC renewable energy urged

The UAE and other Gulf oil producers need to introduce incentives to encourage investment in renewable energy given their massive natural potential in this field, the world's main renewable energy group has said.

The Abu Dhabi-based International Renewable Energy Agency (Irena) said global investments in renewable energy projects surpassed those in the conventional energy sector in 2008 for the first time, peaking at nearly $140 billion (Dh514.2bn) against around $110bn in fossil fuel technologies.

"Increasing investment in renewable energy is a strong indicator of the new emerging energy paradigm. From 2004 to 2008, investment in renewable energy technologies quadrupled, and this trend is expected to continue," said Hélène Pelosse, Acting Director-General, Irena.

"Due to its great potential – in particular solar energy – the Gulf region can become a major draw for renewable energy investors. Well designed, comprehensive and reliable support mechanisms for the market entry of renewable energy technology – including research, development and incentive programmes – are needed to boost initial investment and to create attractive market conditions," she said in a lecture this week at the Abu Dhabi-based Emirates Centre for Strategic Studies and Research.

Paying tributes to the UAE, a key member of Opec (Organisation of Petroleum Exporting Countries), she said the country had taken the lead with the commitment to include seven per cent renewable energy in its electricity production by 2020, as well as the Masdar Initiative.

Pelosse pledged support from Irena for its members in the Gulf to accelerate the awareness and adoption of renewable energy technology through its advice on policies, regulatory frameworks and financial instruments, capacity building, statistical data and supportive information. "By combining efforts, we can tap the vast potential of renewable energy for the benefit of current and future generations," she said.

Globally, she noted, although there is an ongoing debate about the exact date for peak oil and gas, it is clear that the world is on the verge of an important energy transition where renewable energies will play a key role.

She said transformations of energy patterns, such as the use of coal followed by oil and nuclear energy in the past, have always been linked to major advances in technology. Today, she added, renewable energy technologies are, in their turn, leading towards a new era – a new energy paradigm that will be a "Copernican revolution in our mindset".

"We have always known that fossil energy resources were finite, yet the potential yield from renewable energy stands at more than 2,000 times the world's current energy consumption, while the sun has a predicted lifespan of five billion years," she said.

"Previously, we were living within a centralised energy system; now we will move towards a decentralised system consisting of numerous production sources including 'prosumers' combining the role of energy producers and consumers… We have been used to a rigid, non-interactive electricity network; in the future smart grids will be intelligent and flexible."

LEADING THE GREEN CHARGE

In a recent study, a veteran Arab energy expert said the UAE is spearheading regional efforts in expanding the use of renewable energy with its $15 billion (Dh55bn) Masdar Initiative and urged other members of the Organisation of Petroleum Exporting Countries to follow suit.

"To maintain, if not increase, the revenues of oil exporting countries, while meeting the objectives of the carbon tax, would it not be preferable to limit oil production and raise prices to a level that is sufficient to stimulate investments in clean and renewable energies," said Nicolas Sarkis, Director of the Paris-based Arab Oil Research Centre.

"That is the case in particular of the UAE, which is regarded as an example to everyone through its construction of Masdar City… In any event, it is not in the interest of any oil-exporting country to swim against the tide, to look like an irrepressible polluter of the environment we all share, or, worse still, to drive oil prices down in order to prevent or delay the development of other cleaner energy sources."

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