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21 February 2024

GCC urged to invest in renewable energy

By Staff

Gulf oil producers need to pump funds into renewable energy sources and give more attention to conservation measures to ensure sustainable growth and manage their supply-demand balance, according to a key British business group.

The six Gulf Cooperation Council (GCC) countries, which control over 40 per cent of the world’s proven oil resources, already have plans to invest heavily in the conventional energy sector to meeting rising domestic power and water demand but they also need to focus on the other sources of energy.

“In the coming years, far more attention will need to be placed on demand supply management. To ensure sustainable growth in the long-term, more investment needs to be channeled towards energy-efficiency measures such as clean fuel and renewable energy supplies, improving water efficiency, investing in new water desalination capacity and buying or leasing agricultural land abroad,” said Debbie Stanford-Kristiansen International Events Director at PennWell Corporation Middle East.

“In view of the demand-supply gap and abundant availability of sunlight as a resource in the GCC, more emphasis needs to be placed on solar power as a viable energy source to meet emerging needs. In order to cater to peak loads, GCC Governments need to implement new projects to mitigate ageing power infrastructure and support new diversification plans.”

Conservation measures, she added such as energy efficient buildings, district cooling, metering and grid interconnections which are slowly gaining higher priority, will also need to be pursued and enforced much more rigorously.

Kristiansen made the remarks in regional media ahead of the PowerGEN Middle East and WaterWorld Middle East conference and exhibition, opening in Doha on Monday.

She said $multi-billion projects are on the cards in the GCC and other Arab countries, including nearly $17 billion in Saudi Arabia in 2013. Projects worth about $4.2 billion are also planned in the UAE and Kuwait.

She said that rising oil and gas prices combined with increasing domestic power requirements are prompting GCC governments to increase investments in the power and water sector, as well as secure alternative sources of energy.

“For most Arab states, raising the contribution of solar and wind power in the energy mix is only one part of the renewables drive. Increasingly, governments realise the need for nurturing new solar-related manufacturing, which will not only create much-needed employment but also assist in economic diversification,” she added.

Kristiansen said high oil prices allowed GCC countries to fund costly energy and industrial projects.

“This is particularly evident in the GCC where now, the most pressing issue facing the utility market is obtaining new and competitively priced gas allocations,” she said.

She noted that the increase in competition for the feedstock is forcing utilities in the region to consider new technology and alternative energy production, such as coal, nuclear and solar for the first time.

“Financing for future projects needs to come from private financial corporations such as the International Finance Corporation which is part of the World Bank Group, together with a consortium of international development finance institutions…. lenders include other banks and Infrastructure Funds.”