GCC Clean Energy: Challenges & Way Forward

Transcription

1 GCC Clean Energy: Challenges & Way Forward 1 st WG Consulta-on Workshop EU GCC Clean Energy Network II Dr. Nasser Saidi 24 May 2016

2 Agenda 3 GCC Clean Energy Challenges: Water Energy Efficiency Subsidies Path to GCC Decarbonisation EU-GCC Cooperation About CEBC

3 Implications of New Oil Normal New Oil Normal implies downside risks for oil resources & prices New Oil Normal is a perfect storm opportunity for radical policy reform to establish a new economic development model, with decarbonisation as an imperative GCC should develop a decarbonisation strategy and implementation policies

4 MENA heats Global Water Heat Maps

5 MENA has Lowest Available Renewable Freshwater Resources Annual Renewable Freshwater Resources per Capita (m3/person/year, 2014) Middle East & North Africa South Asia Sub-Saharan Africa East Asia & Pacific Europe & Central Asia North America La-n America & Caribbean Source: World Development Indicators 2016, World Bank

6 MENA/GCC has Highest Water Stress Levels Source: World Resource Ins>tute

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8 Key Policy Takeaways GCC facing a growing water crisis: growing population, urbanisation, incomes & subsidies Adjustment through Desalination expensive Policy adjustments: Removal & targeting of Subsidies Pricing Policy Sustainable Water Management GCC coordination: policy & water infrastructure

9 Problem of MENA Energy In-Efficiency Energy efficiency in OECD countries is 2x GCC & wider MENA region Regional energy intensity has increased by 14% since the beginning of the 21st century, outstripping GDP growth. Indeed, energy intensity has been declining in all regions except MENA GCC consumes more primary energy than the whole of Africa, though they have just one-twentieth of the population! GCC s per capita annual electricity consumption: terawatt-hours vs. global average of TWh - an alarming consumption rate If the region continues on this high energy use path, it will require more than 3% of GDP for energy infrastructure investment by 2030 compared to just 1% for the rest of the world Untapped energy efficiency is likely the least expensive and most effective form of energy available today Targeted energy efficiency measures are MENA policymakers best bet for combating high energy intensity while curbing GHG emissions in the region

10 300 Energy Intensity in selected Arab, OECD, Non- OECD Countries (Energy used/gdp) Source: World Development Indicators 2016, World Bank

11 Climate Change Performance Index: KSA ranks lowest Climate Change Performance Index Share of world populaton Share of Global CO2 emissions Share of Global primary energy supply Share of Global GDP Denmark % 0.08% 0.12% 0.13% UK % 0.90% 1.39% 1.41% Sweden % 0.13% 0.12% 0.36% Morocco % 0.46% 0.16% 0.14% Egypt % 1.15% 0.57% 0.57% Iran % 1.09% 1.63% 1.69% KSA % 0.41% 1.47% 1.42% No country is doing enough to prevent dangerous climate change. So, no top 3 posi9ons Components of the Index Emissions level (30%) Development of emissions (30%) Renewable energies (10%) Efficiency (10%) Climate policy (20%)

12 GCC Energy Policy Reforms & Structural change Gradually reduce hydrocarbon subsidies and replace with incentives for RE industry, including production as well as R&D. Renewables-based desalination should become a clear policy priority for addressing water scarcity in the MENA region Implement policies to increase energy efficiency to reverse large increase in energy intensity (Energy/GDP) over past 20 years Increase awareness by informing consumers & conducting wide based energy audits of productive sectors Develop and implement RE strategy and policy frameworks: including legal & regulatory framework to enable PPP and liberalization of public utilities to allow for private investment and production and a GCC power market Coordinate EE and RE policies across GCC countries and integrate water systems and energy infrastructure, including power grids, to benefit from economies of scale

13 De-Carbonisation: many factors at play Kaya iden-ty

14 MENA Financial Road to Decarbonisation Removal of Fossil Fuel & Water Subsidies Pricing of public utilities Energy Efficiency Investments Carbon Tax

15 Establishing a Green Climate Fund GCC should set-up Green Climate Funds to decarbonise + for urban transformation => paradigm shift towards low-emissions & climate-resilient development Proceeds from a carbon tax => Climate Fund Carbon Carbon tax on Gasoline ($ per litre) Local air pollution Congestion Accidents Total Bahrain Kuwait Oman Qatar #N/A #N/A #N/A Saudi Arabia UAE #N/A #N/A #N/A Source: GeAng Energy Prices Right, IMF

16 EU-GCC RE, EE Cooperation EU can provide technical assistance & learning from relevant experience (e.g. ELENA): ü Review and Rationalize Fossil fuel, Water and Energy Pricing: Tariff Reforms ü Taxation: carbon taxes & price incentives for Energy Efficiency & RE ü Quantitative: product standards, building codes, plan urbanisation and urban design, transportation and logistics ü Design efficient financing mechanisms for energy efficiency based on tried and tested mechanisms Joint R&D in RE Cooperation in promoting RE and climate change investments in MENA Cooperation in set-up of GCC, MENA Climate Funds

17 Clean Energy Business Council What Is CEBC? Clean Energy Business Council (CEBC) is a non-profit, nongovernmental membership association that brings together leading local and international organizations in the MENA clean energy sector from both the private and public spheres Our Purpose: CEBC seeks to become the leading regional forum for local, international corporations and government entities focused on the development and deployment of clean energy in the MENA region Our Focus Areas ü Energy & Water Efficiency ü Renewable Energy Generation ü Implementation of Clean Energy Financing, Legal, and Structural Mechanisms ü Social Impacts of Clean Energy Development

18 lean Energy CEBC: Business Current Council Activities Advocacy Endorse adoption of clean energy policies by public authorities Research Conduct and partner on research efforts to drive clean energy solutions Leadership Series Provide forum events for dialogue between policy makers and industry leaders Women In Clean Energy (WICE) Green Sukuk Working Group Channel market expertise to develop best practices and promote issuance of Sukuk to finance climate change projects SCHOOLS ENVIRONMENT PROTECTION PROGRAM Maintain geographic database of 100+ renewable energy projects from throughout MENA Country Missions Initiate discourse on clean energy policy with government stakeholders in MENA countries Outreach events Host workshops and seminars throughout the year on a range of clean energy topics, including Annual Event

19 GCC Clean Energy Challenges & Thank you Way Forward Dr. Nasser Saidi

20 References Chatham House (2013): Saving Oil and Gas in the Gulf, August Climate Change Performance Index 2016: available at IEA (2015): Market Trends and Medium-Term Prospects, Energy Efficiency Market Report 2015 IMF (2015): Is the Glass Half Empty or Half Full? Issues in Managing Water Challenges and Policy Instruments, Working Paper, June IMF (2015): How Large Are Global Energy Subsidies?, Working Paper, May IMF (2014): Getting Energy Prices Right : From Principle to Practice McKinsey (2010): Energy Efficiency: A compelling global resource World Bank (2016): World Development Indicators 2016 World Resource Institute: