The Middle East can play a key role in decarbonising the global economy given its abundant natural resources, both fossil-based and renewable, Wood Mackenzie said in its ‘Middle East Energy Transition Outlook’ report.
The region’s energy mix consists of 97 percent hydrocarbons today, with renewables’ share expected to grow to just 15 percent by 2050 in the base case, the global research and consultancy said.
“Saudi Arabia and the UAE have set sights on becoming energy transition leaders as they look to carbon capture, utilisation and storage (CCUS), and low-emissions fuels such as hydrogen, ammonia and methanol, as well as green steel, cement and aluminium,” stated Prakash Sharma, Vice President, Scenarios and Technologies Research at Wood Mackenzie.
“Countries importing oil and gas from the Middle East are seeking low carbon alternatives, so broad diversification is required to de-risk oil dependency. The region is fully aware of the challenge and is investing in the petrochemical industry, hydrogen production and CCUS projects,” he added.
Several countries in the Middle East have announced hydrogen and CCUS roadmaps and are looking to develop projects, Prakash stated, adding that COP28 could fast-track the decision-making and invite foreign investments needed to secure a sustainable energy future.
Despite many countries setting ambitious targets, the region’s emissions are still forecasted to remain at current levels of 2 billion tonnes (Bt) CO2 through to 2050 in the base case, with the Middle East expected to reach net zero by 2065 in the pledges scenario.
To reach net zero, Wood Mackenzie advised that Middle East countries should electrify and deploy new technologies in their industrial sectors, electrify 75 percent of their road transport fleet, and meet increased power demand through fully decarbonised supply.
Baseload power and heavy industrial sectors will require widespread deployment of CCUS, with remaining emissions abated through nature-based solutions, the report noted.
Source: ZAWYA Projects (Writing by P Deol; Editing by Anoop Menon)