Booming renewable energy projects seek investors.

Author:Feuilherade, Peter
Position:Business/ENERGY
 
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THE LARGELY UNTAPPED POTENTIAL OF abundant solar resources ill the Middle East and North Africa region is attracting increasing investment ill several renewable energy projects. Oil producing states in particular are looking for ways of reducing their own dependence on diminishing fossil fuels. Another incentive is that they call earn far more by exporting their oil instead of using it domestically.

Energy consumption in the Middle East has grown rapidly ill the last live years, increasing by 22% between 2007 and 2011. The International Energy Agency (IEA) forecasts that the region's energy demands will quadruple by 2050. One of the main factors behind the region's ever-increasing consumption of electricity is population growth, which IAE puts at around 1.5% a year. According to the World Energy Council, a UN-accredited organisation, the Gulf region alone will require 100 gigawatts (GW) of additional power by 2020 to meet increased demand, running at 7.7% annually.

In 2011 global renewable energy investment reached a record $257bn, although the MENA region accounted for only $5.5bn, just over 2% of the total.

Political and social turmoil led to investment across the MENA renewable energy sector ill 2011 plummeting by 18% compared with 2010, despite constantly increasing demand for electricity fuelled by rising populations, growing urbanisation and economic growth driven by industrialisation.

However, as a 2012 report by Ernst & Young noted, "many countries ill the region are seeking to increase the proportion of renewable energy in their generation mix as they seek to reduce local consumption of fossil fuels, meet ever-increasing local demand, and even start to diversify their economics away from hydrocarbons."

At least 10 solar energy projects worth a combined $6.8bn are currently under way in Egypt, Jordan, Morocco, the UAE, Kuwait and Oman, according to research specialists Ventures Middle East. Three years ago Morocco invested $9bn in a national solar plan whose long-term aim is to provide nearly 40% of the country's energy needs. It is now looking for another $1.25bn in funding for a concentrated solar power (CSP) project, of which a quarter has already been provided by the African Development Bank, with the World Bank and the European Investment Bank also participating.

Masdar, the renewable energy company backed by the government of Abu Dhabi, the UAE's richest emirate, invests in clean energy technologies both directly and through...

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