Middle East Energy
Renewable energy rises to the top of Middle East’s energy agenda
• Middle East electricity demand to triple by 2050
• More than $100 B worth of clean energy projects already in pipeline
• Cost of installing photovoltaic solar in Middle East has fallen by 73 % since 2010
The Middle East’s energy and utilities sector is undergoing an unprecedented transformation, with the shift towards renewable energy and digital innovation at the heart of ambitious energy diversification programmes. As governments seek to increase energy security and maximise returns from hydrocarbon resources, utilities are pressing ahead with some of the largest renewable energy schemes in the world.
A number of milestones in the push for clean energy across the region were reached in 2019, including the commissioning of the world’s largest single-site photovoltaic (PV) solar plant, the 1.17 GW Sweihan independent power project (IPP) in Abu Dhabi. Shortly after the commissioning of the Sweihan plant in March, neighbouring emirate Dubai reached financial close for a $4.3 B concentrated solar power (CSP) project, the largest single-site power investment project in the world.
The drive to integrate alternative energy resources into utilities networks is set to accelerate in 2020 as governments seek to meet the rising demand for power. Rapid population growth, combined with ambitious industrial and economic expansion programmes, is resulting in growing need for power, with demand for electricity in the Middle East forecasted to triple by 2050. Energy & Utilities estimates that installed power generation capacity will be required to increase 35 % by 2025 just to meet rising demand.
Reducing costs and emissions
With the production of electricity across the region having been predominantly fuelled by oil and gas since the 1970s, utilities are seeking to diversify fuel sources for power generation, with renewables at the core of diversification plans.
While the global targets agreed for reducing carbon emissions at the Paris COP 21 energy conference in 2015 grabbed many headlines around the world, the push for renewables is being facilitated by economics. The drive for clean energy is being driven by the sharp drop in the cost of solar and wind power technologies, with the cost of installing PV solar and wind having fallen by 73 % and 80 % respectively since 2010.