Lack of energy efficiency in economic terms and wastage of electricity and water across the GCC region may seriously challenge the region’s long-held role as a reliable global energy supplier.
Policymakers, administrators and energy economists in the Gulf region have taken note of the serious situation and are formulating policies that curb energy wastage, besides educating consumers on the need to conserve the God-given natural resources.
In its inaugural ‘Industry Report’, The Abdullah Bin Hamad Al Attiyah Foundation For Energy & Sustainable Development has highlighted the rising domestic energy consumption across the GCC and suggested measures to tackle it and reverse the trend.
The highlights of the report, which were exclusively featured by Gulf Times recently, showed energy consumption in the Gulf States has grown by 8% annually since 1972, compared to 2% for the world. Together, four of the six GCC countries (Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates) have less than 1% of the world’s population, but account for more than 5% of global oil consumption.
Saudi Arabia, which consumes roughly a quarter of its own production, is now the world’s number-six oil consumer, consuming nearly as much as Russia as and more than either Brazil or Germany, countries with far larger economies and populations.
Compounding annual growth rates of 6% to 9%, fuelled by increasing population and wealth, have raised Gulf energy consumption to some of the highest levels in the world, measured on per capita basis or – more importantly – in terms of oil consumed per unit of GDP.
According to The Abdullah Bin Hamad Al Attiyah Foundation For Energy & Sustainable Development, as the rest of the world grows more energy efficient in economic terms, most of the GCC is going the other way, using ever more energy to produce a unit of economic growth and becoming less competitive in the process.
The report quoted a Saudi investment bank and said that the kingdom uses 10 times the oil to produce a unit of GDP than the global average.
Obviously, the situation in the neighbouring GCC countries states is no less stark.
Policymakers, administrators and energy economists have warned that if these long-term consumption trends continue, the GCC countries may be just a few decades away from relinquishing their long-held position as global energy suppliers.
At the same, abnormal burning of fossil fuels has seen as a major source for growing greenhouse gases. The Abdullah Bin Hamad Al Attiyah Foundation For Energy & Sustainable Development points out that since 1990, GCC carbon dioxide emissions have grown by an average of 5% a year compared with 2% for the world as a whole.
This has caught global attention so much so that International Energy Agency joined the chorus of prominent multilateral organisations calling for reductions in Middle East oil consumption and associated emissions from its production.
They argue that global climate goals cannot be met without a major change in behaviour in the GCC region.
A major reason cited for the lack of energy efficiency and wastage of electricity and water in the GCC region is the lower price aided by subsidy. Energy is sold more cheaply in the GCC than almost anywhere else in the world.