The systemic waste of oil and gas in the Gulf is eroding economic resilience to shocks and increasing security risks, including to citizens’ health. Success or failure in setting and meeting sustainable energy goals in the Gulf Cooperation Council (GCC) countries will have a global impact, says a new report Saving Oil and Gas in the Gulf.
The six GCC countries - Saudi Arabia, Qatar, Kuwait, Oman, the UAE and Bahrain - now consume more primary energy than the whole of Africa. Yet they have just one twentieth of that continent’s population. Energy intensity in the region is high and rising in contrast to other industrialized regions and is driven by systemic inefficiencies.
Almost 100% of energy in the region is produced from oil and gas without carbon dioxide abatement, and water security is increasingly dependent on energy-driven desalination. If the region’s fuel demand were to continue rising as it has over the last decade, it would double by 2024. This is a deeply undesirable prospect for both the national security of each state and the global environment.
Saving Oil and Gas in the Gulf is the first report to offer practical recommendations that address the key challenges of governance, political commitment and market incentives from a GCC-wide perspective. It draws on the results of two years of research and workshops in the region, with representatives of over 60 local institutions w ith a critical interest in and influence over domestic energy.
The report concludes that efficiency savings are urgent, achievable and will build a bridge to renewables deployment.
Report author Glada Lahn says:
'A small number of individuals in each country are devoting immense efforts to design plans to save energy. But these risk being relegated by the preference for political quick fixes, lack of institutional coordination and sheer bureaucracy.
'All GCC countries now have clean energy targets - the question is whether these plans can be implemented and scaled up in time.'
Chatham House calculations show that planned clean energy introduction in Saudi Arabia, together with basic efficiency measures, could result in savings of between 1.5 a nd 2 million barrels of oil equivalent per day by 2025 - a volume which roughly matches what the country needs to maintain the spare crude capacity so critical to global oil markets. Efficiency could enable renewable energy to increase its share in the energy mix by up to 10 percentage points.
The report proposes specific measures that should be investigated at the GCC level, including the potential for setting common prices for electricity trading and fuel.
Countries should cooperate to establish common appliance efficiency standards for buildings, appliances and vehicles, with air conditioning a priority area. Establishing a common buildings code and building materials standard could bring step changes in energy and water efficiency. This would reduce costs for each country and allow the region to punch above its weight internationally in emissions reduction commitments, argues the report.
Notes to Editors
Read Saving Oil and Gas in the Gulf by Glada Lahn, Paul Stevens and Felix Preston.
The authors are available for interview via the press office.