GCC Countries To Look Beyond Oil And Gas Assets

GCC countries focusing on renewable energy to sustain dominance on global oil and gas trade

Release Date: 12-Oct-2012



Home to about two thirds of the world’s oil and gas, the Middle East is region wise, the largest exporter of fossil fuels in the world and its importance has been furthered with the growing demand for oil and gas. The recent price volatility and the increasing demand from developing economies coupled with its own rising consumption, highlights the need for balancing the trade of commodities while sustaining the environment. The global future is looking at an increasing trend of dependence on renewable rather than oil and gas, which compels the GCC countries to look beyond their asset and start developing the alternate sources of energy. They can play a major role in the current ongoing drive of development of less carbon intensive resources, bringing the cost of energy considerably down, considering the ample amount of solar and wind energy available in these countries which is exactly why the GCC has to increase its focus on the development of renewable energy sources.

The economy of the GCC region almost entirely depends on the export of oil and gas to the major markets in the world, Asia Pacific and Europe. With an increase in domestic consumption, as is being predicted, the quantity available for export will keep on reducing leading to a decrease in revenue, jolting the whole economy on the countries. The signs of decrease in the oil and gas exports have already begun to show reflecting in the decreased petro dollars from the commodities and the governments increasingly trying to diversify their industries. The nations have started realizing that they can’t depend on oil and gas forever to produce electricity and water and have, thus, now started looking towards renewable sources of energy for power generation. This can be seen by comparing the production consumption of the whole of GCC region.

Amidst the rapid expansion, the power generation is also increasing, which is largely oil and gas dependent. The dependence on oil and gas for electricity generation is growing resulting in a larger cut of the hydrocarbon share to be diverted towards the home consumption. Along with the exports, it is necessary to keep the domestic industries running as well which will result in lesser profits from the decreased quantity of exports. This is seen as a major issue with the GCC countries since their economies are highly export dependent. An alternative has to be put in place to sustainably run the machines and keep the exports high as well. Renewable energy sources fit the bill perfectly but a long way to go before it can be used as an alternative for oil and gas in the GCC countries for domestic consumption.

The GCC countries are now relying on the innovations that will give them cheaper and much more efficient power generation solutions as compared to the conventional oil and gas based power generation. The countries are in no mood to introduce subsidy cutting measures as of now so renewable energy based solutions that will affect cheaper and water conserving power generation will be regarded as worthy of the GCC’s attention. This can’t be accomplished without the proper structures and policies in place that support the renewable energy usage in the GCC countries. If renewable energy is being pitched in competition with fossil fuels, which it is, then for the growth the key drivers will be the willingness of each country to develop its renewable energy infrastructure, the seriousness of its policies and the binding targets that will be set by these countries to help renewable energy get a fair share of the power generation market.

The “GCC Renewable Energy Sector Analysis” research report by KuicK Research is an intriguing text that gives facts and projected figures about the paradoxical situation arising in the world, with the world’s largest oil and gas providers looking at renewable sources to light their own bulbs. The report meticulously takes through each country’s electricity and water situation and then its renewable energy efforts along with policies and regulations. It is packed with information and adds a special feature on the GCC interconnection grid that will be fed with power from the renewable sources of energy in the coming years and also gives the potential renewable sources of energy and the future scenario of the GCC region with the latest developments.

 

For more information visit “GCC Renewable Energy Sector Analysis”

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