RENEWABLE ENERGY MARKETS & THE GCC REGION
ADNAN Z. AMIN Director-General IRENA
The transition towards renewable energy is creating a fundamental,long-term shift in the global economy.This shift can be expected to have a significant impact on fossil-fuel producers, including the oil – and gas-exporting countries of the Gulf Cooperation Council (GCC).
The landmark December 2015 Paris Agreement, backed up with detailed plans by countries around the world to overhaul their energy sectors, could imply the eventual softening of global demand for oil and gas, the main drivers of local economies. But it also presents an exciting opportunity for economic diversification and entry to new markets.For the last several years already,GCC countries have been fashioning a critical role for themselves in the global shift to renewable energy. They have done so as investors in major solar and wind projects worldwide and also by adopting innovative and increasingly cost-competitive technologies in their own domestic markets.
With the advent of lowest solar prices in the world, Gulf countries are set to capitalise on their promising solar resources for power generation and water desalination. As the present market analysis finds, the GCC region can cut its annual water use by 16 per cent,save 400 million barrels of oil, createclose to 210,000 jobs and reduce its percapita carbon footprint by 8% in 2030 –all by achieving the renewable energy targets that national and sub-national governments have already put in place.
These current targets are entirely within reach. A solar photoelectrically in Dubai last year resulted in the record-low electricity price of USD 0.06 per kilowatt hour – cheaper than domestically produced power from gas-fired generation. Indeed, for countries that use a substantial share of their hydrocarbon production forpower generation, solar power has emerged as one of the quickest, leastriskinvestments to meet rapid demand growth for electricity and even boost export capacity and revenues.
The economic and social rationale for the energy transition in the GCC has never been stronger. By maintaining their leadership in the energy sector and embracing their region’s abundance of renewable energy resources, GCC countries can ensure their own long-termeconomic and social prosperity througha clean energy future.