Driven by increased population and escalating commercial and residential demand for electricity, especially in the summer months, Gulf States have become significant consumers of oil. Recent research by Oliver Wyman has found that, to address this issue, even modest steps toward greater energy efficiency by MENA countries would result in meaningful savings.
A new Oliver Wyman report, Delivering on the Energy Efficiency Promise of the Middle East, notes that natural gas supplies no longer meet local demand, and oil exporting countries have started to tap into money-generating fuel oil reserves, impacting both local economic growth and global energy security.
The report concludes that the upside of energy efficiency for a country like the United Arab Emirates, which wishes to enhance its competitiveness, is big. Oliver Wyman models indicate that annual energy costs could be reduced by US$3 billion by 2030, assuming constant electricity production costs, with the majority of these savings (~51 per cent) coming in the residential sector, followed by the commercial (~38 per cent) and industrial sectors (~11 per cent).
“The time is ripe for MENA countries to take a closer look at energy efficiency technologies and programs,” notes Marc Hormann, Oliver Wyman partner and co-author of the study. “Even moderate adoption of proven energy efficiency measures could reduce energy demand by a one-quarter to one-half in the year 2030, greatly freeing up capital.”
